(Boursier.com) — The Christmas rally is confirmed for the Parisian market: the CAC40 continues a fifth week of increase with an index which gains 0.93% over five days, to 7,597 points this Friday evening. The flagship Parisian index reached a new historic high on Thursday, at 7,654 points, and brings its 2023 gains to more than 17%.
The operators preferred Jerome Powell’s speech to that of Christine Lagarde. The Fed, as expected, maintained its rates on Wednesday evening between 5.25% and 5.50% for the third time in a row, while its president indicated that the key rate was “approaching if not already having reached its peak”. “The question of when it will be appropriate to lower rates is beginning to arise,” added Powell, thus fueling hopes of an end to the tightening cycle. If the ECB has also opted for a status quo on its rates, its president has somewhat dampened market expectations by indicating that the time for a rate cut had not yet come. “We have not discussed a rate cut at all, no debate on this issue,” said the former head of the IMF.
On the values side, Atos, Solvay and Vivendi topped the list. Focus Home and Lumibird were sanctioned.
On the oil market, black gold prices could end their incredible negative streak (currently +0.8% for Brent). On the currency front, the euro is clearly rising against the greenback, to around $1.09. Finally, Bitcoin consolidates and evolves below $42,000 on Coindesk.
VALUES
* Atos soars by 32% after the announcement of the increase in Onepoint’s capital. The company announced that on December 8 it had crossed the threshold of 10% of the capital of the digital services company and to date holds 11.4% of the capital and voting rights of Atos. “The increase in Onepoint’s participation is part of its logic as a key shareholder of Atos with a long-term vision.” Furthermore, according to information from ‘Figaro’, Airbus is in advanced talks to buy the digital services company’s big data and cybersecurity (BDS) businesses. Citing two people without naming them, the daily specifies that the aeronautics giant and the Atos Board of Directors have started bilateral discussions, without any other player in the negotiations.
* IBS surge of 31.8%. The company announced the conclusion of an investment protocol between the members of the family group of Bernard Huvé (founder and chairman of the supervisory board of SII), Eric Matteucci (chairman of the management board of SII), the other members of the management board of SII, the company SII Goes On and funds managed or advised by Blackstone Tactical Opportunities Advisors LLC, with a view to filing a proposed simplified public purchase offer. The offer is formulated at a price of 70 euros per SII share and will be open for a period of 10 trading days, and possibly followed by a compulsory withdrawal, if the conditions are met, in particular the achievement of a threshold of 90% of the capital and theoretical voting rights of the company.
* Solvay gains 13.2%. Many analysts returned to the Belgian group, now refocused on commodity chemicals, following the Syensqo spin-off (focused on specialty materials and solutions). Stifel thus confirmed its ‘hold’ opinion on the company. The target is set at 28 euros. Despite this upside potential, the broker sees short-term risk due to stock surplus and uncertainty regarding soda ash contract prices for 2024. Solvay targets EBITDA growth of around 5 %. Berenberg (‘buy’) also highlights the main attraction of the ‘old’, one of the highest dividend yields within the Euro Stoxx 600. A yield which should be safe even taking into account ‘a decline in soda ash prices from previous highs. The other business units – notably peroxides and silica – are also solid cash generators in which Solvay occupies a leading position.
* Elior jumped 11.8%. It must be said that the still very influential JP Morgan went from ‘underweight’ to ‘neutral’ on the services group with an objective raised from 2.30 to 3 euros. The bank believes that “the worst is behind us”. However, she does not yet recommend buying the stock because visibility is limited and the underlying dynamics remain worrying. The appointment of Daniel Derichebourg as CEO and the acquisition of Derichebourg Multiservices could nevertheless lead to better dynamics and a recovery in margins, even if there are still too many uncertainties.
* Arkema increased by 8.7%. The chemist was supported by a note from UBS which raised its recommendation to ‘buy’ while increasing its target from 95 to 120 euros. The bank says the expected recovery in volumes should translate into Ebitda growth over the 2024-2028 period, which would enable the 2028 Ebitda margin to be higher than management’s target. Furthermore, the stock offers a double-digit free cash flow yield and the discount to peers is not justified, UBS points out.
* Air France KLM takes off 8.5%, the highest since February. Ahead of an investor day, the carrier indicated that it was targeting an operating margin above 8% over the period 2026-2028, compared to a forecast of 7 to 8% for 2024-2026. A target roughly in line with that set by Lufthansa, which also wants to achieve a margin of at least 8% in 2024. “We are now well placed to accelerate further and exploit the full potential of our Group’s assets in order to generate sustained and more profitable growth,” said Ben Smith, CEO of Air France-KLM. Thanks to a rigorous capital allocation and a targeted capital expenditure program, Air France-KLM will continue to invest in the renewal and maintenance of the fleet to improve its economic performance, and reduce its CO2 emissions and nuisances. sound. For this, the Group estimates net investment expenditure of 3.0 to 3.5 billion euros per year between 2024 and 2026 and 3.5 to 3.8 billion euros per year in 2027 and 2028. Based on With a further acceleration of its transformation program and a better cost-effectiveness ratio, the Group’s operating profit should improve by 2 billion euros over the next five years for all activities.
* Vivendi climbs 8%. While a large number of observers were counting on a takeover of the media and entertainment group by Bolloré, Vivendi surprised by announcing that it was studying a project to split the company into several entities which would each be listed on the stock exchange. A project intended to “fully release the development potential of all of its activities”. Concretely, Canal+ and Havas could return to the stock market and an investment company holding listed and unlisted financial interests in the culture, media and entertainment sectors would be created. This proposed demerger would give all activities the human resources and financial agility necessary for their development., according to Vivendi. Furthermore, Vivendi is reportedly studying various options for its 1.3 billion euro stake in the former Italian telecoms monopoly. According to sources close to the matter cited by ‘Bloomberg’, Vivendi has spoken with advisors to evaluate potential options, including the sale of its nearly 24% stake.
* Saint Gobain (+7.7%) establishes itself in Ecuador. The French giant has reached an agreement to acquire a majority share of IMPTEK Chova del Ecuador – a leading player in the construction chemicals market – marking Saint-Gobain’s first industrial establishment in the country . A key player in the Ecuadorian construction market, IMPTEK operates a factory in the Quito region and employs around 120 people, for a turnover of around 30 million euros in 2023.
* Carmila (+7%), Argan (+7.3%) and Klepierre (+3.2%) benefited from the clear easing of bond rates.
Conversely, * Focus Home plunges 35.9%, abandoned after a disappointing publication. In the first half of 2023/2024, the company’s turnover increased by 30% but Ebitda reached -1.5 ME compared to 10.9 ME in the first half of the previous financial year. The disappointment in sales of Atlas Fallen impacts the profitability of the half-year, the significant number of launches this half-year directly explains the significant increase in depreciation charges within the gross margin and the increase in game marketing costs compared to the same period. last year, management emphasized. No major game releases are expected in the current quarter, which will suffer from an unfavorable basis of comparison, the third quarter of last year having benefited from the successful launches of the games A Plague Tale: Requiem and Evil West.
* Lumibird fell by 7.3%, sanctioned after his warning. A few weeks before the end of the financial year, the turnover and Ebitda margin objective for the current financial year have been revised downwards. The group is now targeting a 2023 turnover of more than €200 million with organic growth of more than 5% (vs. more than 8% previously) and an EBITDA margin of more than 17% (compared to more than 20% previously).
* Crossroads returns 5.3%. Like several European groups exposed to Argentina, the distributor was penalized by the ‘shock’ decision of new president Javier Milei. The latter announced massive reductions in public spending but also a devaluation of the peso by 54%! The official exchange rate of the Argentine currency now stands at 800 pesos per dollar, compared to 366.5 per dollar previously. The Central Bank will now aim for a monthly devaluation of 2%. “The goal is simply to avoid a catastrophe and get the economy back on track,” said Luis Caputo, Argentina’s new economy minister. He said the country needed to tackle a deep budget deficit which he estimated at 5.5% of GDP. “We are here to tackle the problem at the root… To do this, we must end our dependence on the budget deficit.”
* Dassault Aviation stumbles by 3.2%, victim of a note from Oddo BHF which downgraded the file to ‘neutral’ while reducing its target from 214 to 201 euros. According to Cirium, only 20 Falcons were delivered at the beginning of December, which leaves a workload, in the eyes of the broker, too heavy to approach the objective of 35 deliveries this year. The main explanation lies in the still very disrupted state of the supply chain since the company indicates that it has not detected any improvement and suffers from numerous missing parts. Furthermore, if the 6X entered service on November 30, it is a demonstration device and not a commercial delivery. The broker is therefore adopting a more cautious view and reducing its Falcon delivery forecasts for FY 23 but also for future financial years in order to integrate more lasting disruptions in the chain.
* Saffron lost 2.7%, victim of profit taking. JP Morgan still overweights the file with a price target raised from 175 to 215 euros in a market still considered buoyant in 2024 given the geopolitical context… The stock had previously been penalized by a note from Deutsche Bank which downgraded the file to ‘keep’, while lowering its target from 176 to 170 euros.