(Boursier.com) — The crazy rise in the CAC40 will have ended during this first week of December. After nine consecutive weeks of growth, the Paris market lost 1.05% over five sessions, to 6,678 points this Friday evening. Caution has regained the upper hand in trading rooms as Central Banks will again be at the center of the game in the coming days with the meetings of the Fed, the ECB and the Bank of England.
The vast majority of observers are expecting a 50bp tightening from the Fed next week despite recent better than expected economic data in the United States, which caused some confusion. According to the CME Group’s FedWatch tool, the odds of a 50 basis point Fed rate hike on Dec. 14 is 79.4%, compared with a 20.6% chance of a stronger move of 75. basis points. It is a tightening of the same magnitude that is preferred for the ECB on December 15 following the slight lull in inflationary pressures in the euro zone, which would bring the main key rate in the region down to 2.5%.
The week was also marked by the violent drop in oil prices with the entry into force of the latest Western sanctions targeting Moscow and fears of a global recession. The barrel of Brent is trading around $ this Friday. On the currency market, the dollar index is close to 105 pts while the euro continues to rise, above $1.05 between banks. Bitcoin is trading below $17,180 tonight.
On the business side, ALD, Derichebourg and Sanofi stood out. Conversely, Euroapi and Groupe ADP fell.
VALUES
* ALD soared by more than 16%, boosted by a note from Stifel which began monitoring the company specializing in long-term rental and car fleet management with a ‘buy’ notice and a target of 21 euros. ALD is expected to post record profits in 2022, which the broker expects will remain high despite the recession and for a long time, as the fundamental increase in vehicle values pushes up profits. The group, which is also about to change size with the acquisition of LeasePlan, is, according to the analyst, largely undervalued.
* Derichebourg climbed 8.5%, boosted by historic results. The group of services to companies and communities achieved in its 2021-2022 financial year ended at the end of September a current EBITDA of 510.1 ME for a turnover of 5.3 billion euros, an increase of 45.9% . Operating profit was 344.5 ME, up 31.1% and net profit attributable to shareholders was 237.6 ME, up 36.5%. The board of directors will propose to the general meeting the payment of a dividend of 0.32 euro per share, representing 21.5% of the net profit attributable to shareholders.
* Elior takes almost 8%. Derichebourg took advantage of its otherwise excellent annual publication to confirm that it had no intention of filing a takeover bid on the collective catering group. On the other hand, the company reaffirmed the existence of discussions with Elior for the possible contribution of its multiservices branch, while specifying that “to date, there is no certainty as to the outcome of these discussions and the conclusion of a firm agreement relating to this contribution”. On the analyst front, UBS (‘neutral’) adjusted its target from 3 to 3.2 euros while Stifel raised, at the start of the week, its recommendation on the stock to ‘keep’ with a target raised by 2, 2 to 2.9 euros.
* Sanofi gained 3.5%, driven by an important legal victory in the United States. Several thousand complaints filed in federal justice against the pharmaceutical groups GSK, Pfizer, Boehringer Ingelheim and the French giant establishing a link between Zantac, a drug against gastric acidity, and cancer were dismissed on Tuesday by a Florida judge. Robin Rosenberg, District Judge of West Palm Beach, has indeed considered that the complaints were not supported by solid scientific arguments. Zantac, approved in 1983, became the world’s top-selling drug in 1988 and one of the first to exceed $1 billion in annual sales. First marketed by a predecessor of GSK, it was then sold successively to Pfizer, Boehringer and finally Sanofi. In 2019, several manufacturers stopped selling Zantac over concerns that its active ingredient, ranitidine, would break down over time to form NDMA, a chemical found in low doses in water and food but known to cause become carcinogenic at higher doses.
* Elis rose 3.1%, the highest since early September. It must be said that the group specializing in cleaning and hygiene benefited from significant support since JP Morgan raised its recommendation on the issue to ‘overweight’ while maintaining its target at 16.5 euros. Volumes are expected to remain ‘defensive’, with a potentially stronger winter hotel season providing some support early next year, the US bank says. She points out that management has indicated it can successfully offset new cost pressures in the second half of 2022 and has already secured price increases for fiscal 2023.
* Saint Gobain (+2.4%) would be close to separating from Jewson. Two months after indicating that the French group had launched the process of selling this English distributor, ‘Bloomberg’ announced that an agreement with CVC Capital Partners is about to be concluded. According to agency sources, final details are being finalized. While deliberations are still ongoing, another buyer could still emerge if the talks drag on or collapse, the agency nevertheless said. Acquired in April 2000, Jewson could bring more than a billion pounds to Saint-Gobain. Founded in 1836, Jewson employs nearly 6,000 people across the Channel. The firm made about 170 million pounds of Ebitda last year.
Conversely, * Euroapi fall of 16.2%, shaken after its earnings warning. After identifying certain deviations from good manufacturing practices for certain prostaglandins, relating to the management of documentation, at its Budapest site, a temporary suspension of production was put in place. A decision which forced the world number 1 in active pharmaceutical ingredients to revise downwards its financial forecasts for the current year. Sales are now expected at 980 ME, against 1 MdE previously, with an EBITDA margin of 12-13% against an initial guidance of at least 14%.
* GTT stumbles 11.1%. The group said that by a decision dated December 1, 2022, the Seoul High Court partially upheld its appeal against the Korea Fair Trade Commission’s corrective order by canceling the administrative fine of 9 .5 million euros paid by GTT in early 2021… In the same decision, the Seoul High Court confirmed GTT’s obligation to separate the technology license agreement from the technical assistance if the Korean shipyards do so. ask. GTT immediately announced that it was studying this decision in detail in order to define the most appropriate actions to take to assert its rights and considers that its unique expertise is the key to the safe development of LNG maritime transport, enabling it to provide ever more innovative, safe and high-performance technologies, for the benefit of the entire industry.
* ADP Group fell by 10.1% after Royal Schiphol Group announced the sale of its residual stake in Aéroports de Paris (ADP Group). The Dutch company sold more than 3.85 million shares in the manager of Paris airports, or around 3.91% of the capital, as part of an accelerated placement with institutional investors at a price of 133 euros per share. A level which materializes a discount of almost 10% on the closing price preceding the announcement. In accordance with the withdrawal agreement that was concluded between the parties on December 1, 2008, Royal Schiphol Group will buy back the shares held by Groupe ADP in Royal Schiphol Group, which will mark the end of the process of unwinding cross-shareholdings with Royal Schiphol Group. The proceeds of this transaction, for the benefit of Groupe ADP, amount to approximately €420 million.
* quadient lose 10%. SES Imagotag will replace the firm specializing in logistics equipment and mail processing at the SBF 120 and CAC Mid 60.
* Plastic Omnium makes 8.4%. The selling flow on the automotive supplier was fueled by a rating from JP Morgan which downgraded the file to ‘underweight’ while reducing its target from 17 to 14 euros. Thursday, it was Kepler Cheuvreux who had lowered its recommendation on the value to ‘keep’ with an adjusted target of 18 to 16 euros. Overall, analysts are now fairly divided on the title since, according to the ‘Bloomberg’ consensus, 4 are ‘positive’, 4 are ‘neutral’ and 2 are ‘sell’. The average 12-month target is set at 17.37 euros.
* Worldline gives up 7.5%. JP Morgan downgraded the title of the payment specialist to ‘neutral’ while reducing its target from 59 to 55 euros. The bank explains that the group should face more difficult comparables in 2023, and sees risks for the growth of the merchant services branch given a difficult macroeconomic context and a lower contribution from airlines. Adyen is now the broker’s top choice in the sector due to a more diversified global presence and lower market expectations.
* Vallourec yields 7.2%. According to information from ‘Bloomberg’, Nippon Steel sold its entire stake in the manufacturer of seamless tubes by selling 7.85 million shares at a unit price of 9.90 euros. A level that represents a discount of 5.7% on the closing price preceding the announcement.