(Boursier.com) — Edenred drops another 2.3% to 46 euros this Wednesday, despite record results published yesterday… The group confirmed its objectives for 2024, set in its strategic plan ‘Beyond 2022-2025’, namely growth in Ebitda on a comparable basis greater than 12%, and says it expects continued strong growth in activity in all regions and all business lines.
The ‘Bloomberg Intelligence’ teams believe, however, that investors are still worried about the threat of a fine in Italy… For Baader Bank, the profits stood out slightly below expectations and the analyst notes low order intake, Edenred not having been able to win two major projects. Reported Ebit and margin came in below the guided range, due to “higher restructuring provisions than previously indicated” for HOMAG and Industrial Automation.
Decent pace?
Citi (‘neutral’) considers the concerns raised by the recent investigation carried out in Italy to be “exaggerated”. The bank expects management to focus on strengthening market confidence. She speaks of positive results with a “decent pace” on free cash flow and slightly increasing profits…
Despite the lack of visibility on the Italian legal risk, Oddo BHF reiterated its ‘outperform’ opinion due to significant growth prospects (growth in operational turnover of more than 10% per year on an organic basis), reflecting the underperformance penetration of its markets (average penetration rate of 25 to 30%); still significant margin improvement potential, supported by the digitalization of its solutions and operational leverage (CAGR EBITDA 2022-2025e of 20%); and strong FCF generation (cash conversion rate above 70%). Edenred’s valuation at 21x the 2024 PE implies a discount of 20% compared to its average NTM multiple over the last 7 years, concludes the broker…
BNP Paribas Exane, for its part, is ‘outperforming’ on Edenred, but with a price target reduced to 63 euros, while Morgan Stanley remains ‘in line’, but raises its target from 58 to 60 euros.
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