N. CHRYSSOCHOIDIS S.B.I.S.S.A.: Στα 14,0000 ευρώ η δίκαιη τιμή της Μυτιληναίος – Top Pick in our Hellenic Universe…

N. CHRYSSOCHOIDIS STOCK BROKERAGE INVESTMENT SERVICES S.A.
Equity Research Department

EQUITY RESEARCH (FUNDAMENTALS) – MYTILINEOS S.A (MYTIL.AT)


Επαναλαμβάνουμε ότι η δίκαιη τιμή για την μετοχή του ομίλου ΜΥΤΙΛΗΝΑΙΟΣ
παραμένει στα 14,0000 ευρώ λαμβάνοντας υπόψη την ικανοποιητική ενδιάμεση οικονομική κατάσταση της Εταιρείας, τα αποτελέσματα και την καθοδήγηση της διοίκησης σχετικά με την αναμενόμενη μεσοπρόθεσμη απόδοση των κύριων επιχειρηματικών μονάδων.


Ημερομηνία: 05/12/18
ΕΚΤΙΜΩΜΕΝΗ ΤΙΜΗ: 14.00Euros
Επενδυτική σύσταση: Undervalued
Βασικά στατιστικά στοιχεία:


Τιμή μετοχής*: 7,9500 ευρώ
Τιμή Υψηλή 52 εβδομάδες :10,5400
Τιμή Χαμηλή 52 εβδομάδες: 6,7000
Τρέχουσα αριθ. των μετοχών: 142.891.161
Cap Cap.: 1.135.984.730
EPS (E): 1,15
DPS (E): 0,36
* Τιμή κλεισίματος 04/12/2018


We retain Mytilineos S.A Fair Estimated price to 14.00 Euros/Share taking into account its satisfactory interim financial results and the management’s guidance regarding the Company’s midterm performance.

  • According to the management’s expectations for revenue growth and operating performance in combination with the already stated plans for organic expansion for the Metal and Power Units we believe that the generation of stronger cash flows is more feasible on a midterm basis. That possible upward boost of free cash flows confirms our previous estimates and could assist the company to implement its organic expansion plan without harming its capital structure and generate additional value to shareholders due to the decreasing debt exposure and the elimination of minorities.

The M&M business unit still has a remarkable fiscal year in terms of revenue growth and profitability,positively affected by the favorable Alumina prices/Tn paired with the lower Brent price. The M&M Business Unit could be characterized as the dominant growth indicator for the Group and the management is expecting that the favorable Industry conditions could persist in a midterm business cycle.

As a result, the M&M business unit could effectively contribute to the expected growth both in Revenues and operating earnings respectively. EPC-Infrastructure segment (METKA) demonstrated a material revenue deceleration on a 9M basis. Despite that, the guidance is optimistic for the Unit’s performance, due to the unfreezing of delayed
construction projects (Libya) and the new RES construction projects that may pose a strong potential for revenue growth.

Considering the above, we incorporate to our valuation model management’s indications regarding the FY’18 and the expected performance for the 2019-2021 periods. Specifically, we retain the M&M Unit’s growth potential considering the upward revenue trend and the operating efficiency, in combination with our projections for the Energy and EPC units utilizing a more rapid growth in the expected revenue stream, and the gradual gain in market share for the company’s Energy segment.

Finally, we believe that the faster than expected revenue growth paired with the Company’s evidenced operating efficiency could bring significant changes in our FCFF projections despite the increased expansion CAPEX (construction of a power plant energy facility that is expected to be completed by the end of FY’21 and will contribute additional 665MW to the Energy Unit’s capacity). In our previous analysis, the growth assumptions of the company’s performance lead us to cumulative 418.00mn.Euros in
FCFF. However, according to the alterations to our valuation model due to the management’s guidance we are imposed to revise upward our expectations for the FCFF leading to 482mn.Euros for the same period.

In closing remarks, we feel confident regarding our valuation model assumptions and we retain our estimates regarding the EV of the company to 2.60bn. Euros and 14,00Euros/Share as a Fair Estimated price and a UV rating. We consider MYTILINEOS S.A. as a considerable investment case with clear growth path, ability for organic growth in favor of its shareholders and reiterate its share as a Top Pick in our Hellenic Universe…


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