Wednesday, 11 June 2014

EDPR - Renewable shake down

Today's research note about the Portuguese company EDP Renováveis. Goldman Sachs in a latest research note cuts the price target for the company from a period of three years starting at 2016 (2016-2018). The business paper Jornal de Negócios had access to the American Investment Bank research note, which I reproduce here a translated version with a link to the original Portuguese site.

'' "Our estimates of earnings per share for 2016-2018 were cut by 16%, 15% and 14%," says the analyst Manuel Losa in the analysis note.

"Our target price is based on a combination of 50:50 assessing the sum of its parts, from 4.90 euros, and assessing multiple of EV / EBITDA [enterprise value to EBITDA ratio] of 5.40 euros" , the note explains. The evaluation of the sum of the parts "includes € 1.7 billion of sales to a premium of 30% over the review"  of the investment house, which is "in line with the history of EDP Renewables".

The investment house said that, on the side of "positive" risks are higher than sales to an assessment by the Goldman Sachs bonus. Have the opposite side is the "new government intervention", as well as sales at lower than the rated value.

The shares of the company led by Manso Neto following losing 0.50% to 5.333 euro

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