In a little moved market in Europe, in Milan the price list pays the price for Leonardo's new fall which, after last week's collapse, continues its descent on Monday morning. The stock loses 3,53% at 10:57 and travels at 10,68 euros.
Telecom Italia also fell sharply after the presentation of the quarterly report and the conference call with the analysts of the new Ad Amos Genish last Friday. Telecom shares are at the values of a year ago at 0,6935 euros (-2,67%), after reaching a maximum of 0,9145 under the leadership of Flavio Cattaneo in May. The stock is penalized by a series of valuations by financial analysts.
La Goldman Sachs recommendation it moved to “neutral” with a target price of €0,86 (from €1,01).
Overall, the operators report the good indications they received from the first meeting with the new CEO Amos Genish (for example in the focus on new fiber customers) but they also underline the decline in the operating margins of domestic activities and continue to underline the uncertainties deriving from the arrival by Iliad and by competition from Enel on the network. Goldman Sachs underlines the strong growth opportunities in the fixed line for Telecom, but also the short-medium term risks in the mobile sector, in addition to the fact that the digitalization efforts underway in the company will be able to offset the reduction programs in the short term of costs. For the US broker, Iliad, Open Fiber and the expectation of Genish's strategies that will be illustrated in March in the 2018-20 plan represent factors of uncertainty that invite caution.
- Equita analysts they underline, for example, that the trend reversal in domestic Ebitda (-2,4%) can be explained by non-linear factors but at the same time highlights "a quality of past growth that is lower than perceived". The broker, while recommending customers to "buy" the stock (the improvement of Italian activities, the growth of cash flows and Tim Brasil are among the arguments in support of the thesis), reduces the price target to 1,06 euros: “We have marginally revised the sales/ebitda estimates. Instead, we reduce 2018 free cash flow to 1,1 billion from 1,4 billion for payments for new frequencies. We reduce the valuation by 16% by incorporating higher capital intensity also in the medium term”.
“Good impression from the presentation of the new CEO Amos Genish – he writes Intermonte – working to further accelerate the acquisition of fiber customers and to re-establish good relations with the regulator and the government”. Second Credit Suisse, the prospects for the Telecom stock remain dependent on external factors such as the strategies of OpenFiber on the network and the launch of Iliad services on the network: the way in which Genish will be able to deal with these two issues, according to the broker who maintains the "Buy" recommendation, is the key to the performance of the quotations which continue to trade at a significant discount on the sector.
Profit-taking on Bper bank which lost 3,31% after last week's increases.
(Updated 11:45am)
