CaixaBI has re-hedged Mota-Engil shares, with a target price of €2 per share, a valuation that gives a bullish potential of more than 45%. The recommendation is to “buy,” with analysts arguing that CCCC’s strategic partnership with the Chinese could open up new markets for the Portuguese builder, as well as facilitate financing.
Analyst Artur Amaru wrote in an analytical note entitled “Golden Visa – The Beginning of a New Era”, published this Thursday and which Negosius has access to.
The analyst believes that the agreement allowed the Portuguese company to receive an injection of capital at a difficult time, as well as allowing Mota-Engil “access to new sources of funding, expertise and knowledge from one of the largest infrastructure groups in the world.”
CaixaBI also notes that the two companies, CCCC and Mota-Engil, have been working together over the past two years, with interesting results for the Mota-Engil business. He points, for example, to the projects it won in Trin Maya, Mexico, and Talsa, Colombia.
Analyst Artur Amaro concludes, “We believe that this alliance should continue to bring in additional revenue and EBITDA to the company, namely in Latin America, allowing a significant reduction in financial debt on the balance sheet.”
Despite the good prospects for this alliance, CaixaBI has lowered its estimate for consolidated company revenue by 4% and by 4.2% for consolidated EBITDA for the period from 2021 to 2023. “We are more optimistic for Europe in terms of revenue growth while we are more pessimistic for for Africa and Latin America,” says the bank.
The construction company’s shares continued to fall 1.55% to €1.334, weighed down by negative sentiment in Lisbon Square. Looking at the current price, the CaixaBI target for the euro gives a potential upside of 49.9% in the stock.
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