(BFM Bourse) – Euronext’s scientific council delivered its verdict this Thursday evening. The hotel group will integrate the Parisian index at the expense of the railway equipment manufacturer.
More than three years after leaving it, Accor will sign its return to the CAC 40. The scientific council of Euronext has decided, and the hotel group will soon integrate the most important index on the Parisian market, replacing the railway equipment manufacturer Alstom , announced the stock exchange operator.
The change will be effective on March 15 after the market closes, Euronext said.
Already expected to return to the CAC 40 last December, during the previous revision of the stock indices, Accor was ejected from the index in September 2020, in the midst of a pandemic. The company led by Sébastien Bazin was then replaced by…Alstom.
“We are proud to see Accor re-enter the CAC 40, a major success which testifies to the hard work and unfailing commitment of our teams (…) After a record financial year in 2023, the group is having a successful start to the year 2024 solid, driven by an increase in the occupancy rate and strong demand, which allows us to look forward to the years to come with optimism,” responded Sébastien Bazin, CEO of Accor, quoted in a company press release.
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Still potential for Accor, according to UBS
The hotel group has enjoyed good stock market performance in recent months. Accor has gained 14% since the start of 2024 and almost 24% over one year.
The company rode the recovery of tourism, raised its annual outlook several times last year, held an investor day which was considered successful, given its credit rating raised by the agencies, and announced buybacks of actions. So a lot of good boxes have been ticked.
A sign of the rebound in the hotel operator’s activity, Accor published record results for 2023 two weeks ago, with gross operating income (Ebitda), at its highest ever, at more than 1 billion euros.
Encouraged by the publication, UBS bank purchased the stock last week.
“We believe that it is possible to further increase the multiple (of valuation on the stock market, editor’s note) if management continues to implement its strategy and therefore to reduce the valuation gap compared to comparable companies like (the British) IHG”, explained the Swiss bank.
Conversely, Alstom was a perfect candidate for an exit from the CAC 40, even if Teleperformance, which lost more than 23% this Thursday, could also be threatened. Alstom has the lowest market capitalization of the CAC 40 (barely 4.6 billion euros) and lost more than 57% over one year.
Change also on the SBF 120
Its shares plunged nearly 38% in one session in the fall after the group announced that it had burned more than a billion euros in cash over the first six months of its staggered financial year.
The company is currently considering several ways to strengthen its financial balance sheet, with, among the levers considered, a potential capital increase. The aim is to reduce its debt and thus preserve its credit rating, currently located on the last notch of the non-speculative category, and which is threatened by Moody’s. The agency assigns a negative outlook to this rating.
Getting the cash back on track when it publishes its annual results on May 8 is an imperative to begin Alstom’s stock market redemption…Before a possible return to the CAC 40.
The CAC 40 is not the only Parisian index to experience a change in composition. The SBF 120, the second major barometer of the Parisian market, recorded three exits: the retirement home specialist Clariane (formerly Korian), which suffered enormously on the stock market from the fragility of its balance sheet, the renewable energy producer Voltalia, and the specialist in household appliances and cultural goods Fnac Darty.
On the contrary, two companies will enter the SBF 120: the cement manufacturer Vicat, which recently delivered good annual results, and the oil group Maurel et Prom.
Remember that the Euronext scientific council, to decide on entry or exit from the index, is based on two rankings of Parisian stocks: weight in terms of floating market capitalization and trading volumes. Although these rankings serve as support for scientific advice, they do not constitute exclusive criteria.
“It is more or less accepted that the Euronext scientific council, beyond technical criteria, can take into account other issues, such as the sectoral diversity of the CAC 40,” Pascal Quiry, professor, explained to BFM Bourse at the end of 2023. in finance at HEC and co-author of the Vernimmen letter.
Julien Marion – ©2024 BFM Bourse