(Boursier.com) — Worldline climbed 1.8% to 40 euros on Friday. The payment services specialist still benefits from certain ratings from brokers, like that of Morgan Stanley, which raised its recommendation to “overweight” against “online weighting”, aiming for a price of 51 euros. The bank evokes an outlook of “attractive and defensive growth”…Organic growth will be supported by higher inflation, price increases and a recovery in travel, while the structural advantages linked to the transition to card payment and Market share gains on banks will remain intact, according to the analyst. MS also sees “merger and acquisition opportunities around banking partnerships and distribution”, and notes the easing of competitive pressures… The title is showing a gain of nearly 6% this week.
The group’s accounts recently published were perceived as “solid” by the financial community, while the forecasts left some analysts unsatisfied. The payment services specialist recorded last year an OMDA (gross operating surplus) of 1.13 billion euros, materializing a margin of 26%, up 110 basis points, for a turnover of 4.364 billion euros, up 10.7% organically. Free cash flow reached 520 ME.
Management anticipates 8% to 10% organic revenue growth in 2023, more than 100 basis points improvement in OMDA margin compared to 2022 pro forma and 46% to 48% conversion rate of OMDA in free cash flow.
And now ?
Among other analysts’ opinions, Bryan Garnier lowered his target to 61 euros while remaining on the buy side. Oddo BHF (‘outperforming’), which is targeting a price of 58 euros, against 60 euros previously, mentioned “solid” prospects for 2023, but the broker nevertheless thinks that the market consensus could remain cautious, given the still macroeconomic context. uncertain and the fact that the favorable effects linked to the return of travel and inflation are set to decline…
But it is also important to note that some of the negative effects of 2022, such as the cessation of Russian activities and the renegotiation of commission rates on Equens, are no longer present (impact of approximately 2% on turnover according to his estimates). As for the valuation, the analyst does not think that the current level reflects the group’s prospects, which remain very solid (2022-2025 EBITDA CAGR of 15%).
Citi (‘buy’) noted that the revenue outlook was strong and shows the improving performance of Worldline’s business, but the absolute level of profitability is slightly below the consensus. Stifel (‘buy’) also spoke of solid results and in line with expectations, but also noted a “slight disappointment” on the 2023 implied OMDA margin, which should improve as expected, but from a weaker base…
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