Assa Abloy: Oddo still a buyer before results
(CercleFinance.com) - Oddo confirms its buy rating on the Assa Abloy share, along with its target price of 215 SEK before the group announces its Q2 results.
Over the past 6 months, the stock has outperformed the sector by more than 10%, although its premium relative to peers (capital goods groups that have market capitalisations of over 10 billion euros) remains reasonable at 15%, based on 2018 and 2019 multiples (against 20-30% historically), the broker said in its daily equity report.
The broker estimates that Q2 results will increase slightly relative to Q1 due to the non-recurrence of exogenous factors, although (a few) operational difficulties should continue to weigh.
For Q2 alone, Oddo expects organic growth of 4.9% (after 3.9% in Q1 2018) and a 10-bp improvement in its EBIT margin to 16.2% (after -10bp in Q1 2018). For the APAC division alone, which includes China, representing 6% of the group's sales), it expects organic growth of 5.5%, with a 50-bp improvement in its margin to 11.7% (after respectively +4% and 0bp in Q1 2018), Oddo said.
Copyright (c) 2018 CercleFinance.com. All rights reserved.
The information and analyses distributed by Cercle Finance are only intended as decision-making support for investors. Cercle Finance's responsibility may not be entailed, either directly or indirectly following the use of such information and analyses by readers. Any non-professional investor is recommended to consult a professional advisor before making any investment decision. This indicative information in no way constitutes any invitation to sell or buy securities.
Over the past 6 months, the stock has outperformed the sector by more than 10%, although its premium relative to peers (capital goods groups that have market capitalisations of over 10 billion euros) remains reasonable at 15%, based on 2018 and 2019 multiples (against 20-30% historically), the broker said in its daily equity report.
The broker estimates that Q2 results will increase slightly relative to Q1 due to the non-recurrence of exogenous factors, although (a few) operational difficulties should continue to weigh.
For Q2 alone, Oddo expects organic growth of 4.9% (after 3.9% in Q1 2018) and a 10-bp improvement in its EBIT margin to 16.2% (after -10bp in Q1 2018). For the APAC division alone, which includes China, representing 6% of the group's sales), it expects organic growth of 5.5%, with a 50-bp improvement in its margin to 11.7% (after respectively +4% and 0bp in Q1 2018), Oddo said.
Copyright (c) 2018 CercleFinance.com. All rights reserved.
The information and analyses distributed by Cercle Finance are only intended as decision-making support for investors. Cercle Finance's responsibility may not be entailed, either directly or indirectly following the use of such information and analyses by readers. Any non-professional investor is recommended to consult a professional advisor before making any investment decision. This indicative information in no way constitutes any invitation to sell or buy securities.