03/12/2010

10h32 les indices et 1 reco

RECO de ING...ce matin...Belle valeur.

CFE (BUY, TP €55.5): We expect DEME to highlight its non-dredging exposure and solid order book
For further information contact analyst: Tijs Hollestelle, Amsterdam (31) 20 563 8789

  • Today DEME and its shareholders Ackermans & van Haaren and CFE host an analyst/investor day at DEME’s HQ in Zwijndrecht Belgium.
  • We expect DEME to highlight (1) the success of its diversification strategy executed in recent years and to focus on the non-dredging activities representing an increasingly important part of the group’s business (2) the solid position of the dredging business (3) the strong short to medium term outlook (current order book already provides plenty of visibility on fleet u-rates in 2011F) (4) on a modern and versatile fleet and equipment.
  • Last year DEME derived almost 30% of total revenue from so-called non-dredging activities. We believe management will emphasise on this exposure today, which is a good thing as in our view this exposure is not fully recognised by the market yet. Disclose on profitability levels of these different activities, so far has been limited and we expect to hear a bit more on margins, capital requirements etc. Recent examples of non-dredging activities are; the launch of CTOW (one-stop shop marine services provider including terminal services) and Flansea (wave energy converter). DEME has established a good position in the European offshore windmill farm market (with big contracts at hand). DEME’s environmental business (DEC) is already well known and we estimate generates about €175m of annual revenue.
  • DEME’s 3Q10 order book arrived at €2.12bn flat versus the beginning of the year and a very good starting point for 2011, which we expect management will underline once more today.
  • We rate CFE BUY, believing DEME’s order book already secures healthy profitability levels for 1H11, while the construction business, though facing harsh market conditions, is doing relatively well from a risk management perspective (dredging remains by far the dominant factor for CFE’s earnings). Valuation has recovered slightly from its rock bottom level at the beginning of the year, but remains modest, in our view. As we continue to like dredging for its solid visibility and chance of a pick-up in demand in 2011, and the improved general economic picture which will ultimately be supportive of the late cyclical construction activities in the Benelux, we are prepared to pay a target EV/EBITDA of 5.5x for dredging and 3.0x for construction, resulting in a blended EV/EBITDA 2010-2011F of 4.9x and 5.3x respectively. Our TP stands at €55.5.
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10:33 Écrit par swingteam-cc | Lien permanent | Commentaires (0) |  Facebook |

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