European Thematics

A new direction for Europe

Authored By
Analyst Name Eric Lopez
Employed by a non-US affiliate of BofAS and is not registered/qualified as a research analyst under the FINRA rules.
Analyst Email eric.j.lopez@bofa.com
Analyst Designation Head of EMEA Equity Research
Analyst Region MLI (UK)
Analyst Name Mark Troman
Employed by a non-US affiliate of BofAS and is not registered/qualified as a research analyst under the FINRA rules.
Analyst Email mark.troman@bofa.com
Analyst Designation Research Analyst
Analyst Region MLI (UK)
Analyst Name Robyn Dawson
Employed by a non-US affiliate of BofAS and is not registered/qualified as a research analyst under the FINRA rules.
Analyst Email robyn.dawson@bofa.com
Analyst Designation Research Analyst
Analyst Region MLI (UK)
Analyst Name Haim Israel
Employed by a non-US affiliate of BofAS and is not registered/qualified as a research analyst under the FINRA rules.
Analyst Email haim.israel@bofa.com
Analyst Designation Equity Strategist
Analyst Region Merrill Lynch (Israel)
Report Details
22 March 2022 Equity European Research

European Thematics

A new direction for Europe

Authored By
Analyst Name Eric Lopez
Employed by a non-US affiliate of BofAS and is not registered/qualified as a research analyst under the FINRA rules.
Analyst Email eric.j.lopez@bofa.com
Analyst Designation Head of EMEA Equity Research
Analyst Region MLI (UK)
Analyst Name Mark Troman
Employed by a non-US affiliate of BofAS and is not registered/qualified as a research analyst under the FINRA rules.
Analyst Email mark.troman@bofa.com
Analyst Designation Research Analyst
Analyst Region MLI (UK)
Analyst Name Robyn Dawson
Employed by a non-US affiliate of BofAS and is not registered/qualified as a research analyst under the FINRA rules.
Analyst Email robyn.dawson@bofa.com
Analyst Designation Research Analyst
Analyst Region MLI (UK)
Analyst Name Haim Israel
Employed by a non-US affiliate of BofAS and is not registered/qualified as a research analyst under the FINRA rules.
Analyst Email haim.israel@bofa.com
Analyst Designation Equity Strategist
Analyst Region Merrill Lynch (Israel)
Report Details
22 March 2022 Equity European Research
Glossary
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>> Employed by a non-US affiliate of BofAS and is not registered/qualified as a research analyst under the FINRA rules.

Refer to "Other Important Disclosures" for information on certain BofA Securities entities that take responsibility for the information herein in particular jurisdictions.

BofA Securities does and seeks to do business with issuers covered in its research reports. As a result, investors should be aware that the firm may have a conflict of interest that could affect the objectivity of this report. Investors should consider this report as only a single factor in making their investment decision.

 

 

Key takeaways
  • We identify seven key structural themes that will redefine Europe given the Russia-Ukraine conflict
  • Key themes: Defence, ESG, energy independence, energy transition, supply security, cost competiveness, high inflation/rates
  • We also identify companies exposed to these themes with $1.75tn of market cap across 13 sectors

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European Thematics

An ambitious journey towards independence

The Russia-Ukraine conflict will have far-reaching effects that look set to redefine many megatrends in Europe. We believe it is one of those rare events in history that will reshape geopolitics, societies and markets. Europe will transition to be more independent and redefine many of its sectors and economic paradigms. The consequences will range from the development of new industries, the acceleration of existing ones, additional infrastructure and technologies, while reaching independence and leadership for some. It will come at a cost; some industries may end up at the high end of their industry cost curves, inflation and interest rates may end up higher for longer, and low income consumers could be the big losers. We try to offer our first thoughts about what the path to a new Europe could look like and start navigating it. The purpose of the report is to identify trends that we believe to be long lasting and the companies that will be impacted.

Seven themes that will redefine Europe

(1) Defence spending will increase significantly, in our view. We anticipate an additional EUR150-200bn per annum for the Industry;

(2) A higher ESG emphasis. We now expect new regulation to coexist with ESG, as well as a more granular approach. Is "G" the new "E"?

(3) Energy independence is the number one strategic priority. It will take a long time - we think longer than most anticipate - and it will require significant investments in gas infra, low carbon energy sources and carbon capture. We think European gas prices will remain above $200/boe (more than 6x pre COVID levels) for the foreseeable future.

(4) Energy transition is the enabler for Europe's energy independence objective. We expect more investments in what were already growth industries. It doesn't come without challenges but it means more growth for renewables (wind and solar), hydrogen, electricity and gas infra, nuclear, biofuels, EVs and energy efficiency will also be in focus.

(5) Reshoring and security of supply is needed to be more independent. Europe wants to bring key industries back to Europe. It means more capex.

(6) Structural challenges for Europe to remain competitive. Higher gas and energy prices mean that high energy intensive industries could be priced out and will need to leave Europe. For local ones (e.g. cement) it means more margin pressure and price rises.

(7) Higher Inflation and interest rates for longer. We see higher rates as a positive for banks and a negative for real estate. We also believe that inflation pressures will negatively impact European low income consumers and we are cautious on retail.

$1.75tn enablers to remap Europe

As we examine the seven themes, we identify companies that are exposed to the structural changes we anticipate. It's not an exhaustive list, but a first attempt to offer stocks exposed to the themes both positively and negatively. There is plenty to discuss with a combined $1.75tn market cap across 13 sectors.

 

Aedifica (AEDFF)

We use an average of four valuation metrics to derive our PO of 134. In our view these metrics provide a balanced view of the different returns expected from capital and income: economic value added EVA, P/BV, the discounted dividend model DDM (for the total property return) and a discounted free cash flow model DCF (for the ROCE). For each method we use the same CoE of 7.6% and WACC of 5.3%. Overall, our valuation is more weighted toward capital return (57%) than income return (43%).

We average the fair values from each method and round the total to arrive at our PO of 134 - see values for each valuation method below.
DCF. We derive a fair value of 103
DDM. We derive a fair value of 152
P/BV. We derive a fair value of 145
EVA. We derive a fair value of 135

Upside risks are: 1) stronger inflation rate which pushes up rental growth 2) improvement of healthcare operators' financial strength.

Downside risks are: 1) a lower than expected inflation resulting in lower rental growth, 2) less investment volume and yield compression than expected. 3) As well as tightening regulation in the healthcare industry or tenant/operator insolvencies, and ESG requirements or regulation changes.5) Negative read across from ongoing healthcare allegations

Air Liquide (AIQUF / AIQUY)

Our EUR185 price objective (ADR: $42.0) is based on the rounded average of four different approaches:
(1) 12.9x 2023E EV/EBITDA, a 40% premium to the SXXP - at the top end of history given strong growth outlook (energy transition, Electronics) and industry consolidation
(2) 25.2x 2023E EV/EBITDA, a 80% premium to the SXXP - at the top end of history given strong growth outlook (energy transition, Electronics) and industry consolidation
(3) 2.8x 2023E EV/CE, slight above the cross-sector ROCE-EV/CE trendline given above-average growth outlook and below-average profit cyclicality
(4) DCF, using a 6.3% WACC and 3.0% terminal (2026+) growth rate

Upside/downside risks to our price objective are: (1) stronger/weaker than expected global industrial production particularly in key end markets (chemicals, steel, refining), (2) stronger/weaker than expected customer capex trends, (3) faster/slower customer engagement in energy transition-related projects and spending, (4) stronger/weaker industry pricing discipline than we expect, (5) appreciation/depreciation of the USD vs the EUR, and (6) lower/higher bond yields.

Aker Carbon Capture (AKCCF)

Our price objective of NOK30 is based on a DCF. We use a 10.0% WACC. From 2030 to 2050 we assume a 12.5% growth rate, while from 2050+ we use a 5% growth rate.

Upside risks to our PO are: (1) meeting its 10mt cumulative order book target by 2025 and (2) expand margins / returns by adopting a licensing, carbon capture-as-a-service or pay per ton business model.

Downside risks to our PO are: (1) The CCUS market fails to commercialise due to the deceleration of the energy transition, costs remain higher for longer or capital remains directed at other low-carbon technologies, (2) competition grows as the addressable market continues to expand, diminishing returns and margins, and (3) ACC loses market share due to new / cheaper technology substitutes.

APM Maersk (AMKBF)

Our DKK32,000 price objective is based on an SOTP valuation methodology. We apply EBIT multiples to our 2022 estimates for each segment. We disaggregate our 2022E ocean EBIT into a long-term ocean EBIT, based on our 2026 estimate when freight rates normalise, and a 'supernormal' ocean EBIT, which we calculate as the difference between 2022E and LT EBIT. We apply a 15x multiple on the LT ocean EBIT and a 1x multiple to our 2022E super normal ocean EBIT estimate.

The LT ocean multiple is broadly in-line with Maersk's 17x historical average. We use 18x for Logistics, 10x for Terminals and 8x for manufacturing segments. These multiples are in line with global shipping, port operators and forwarders / logistics players. We use the book value for Maersk's associates and joint ventures. We apply a 10% holding company discount.

Downside risks to our view and price objective are: weaker freight rates due to lower demand, end of shipping liner capacity discipline, Chinese government restrictions on freight rates, higher-than-expected bunker fuel prices impacting liner profitability, lower-than-expected cost savings, value destruction acquisition, digitization increases price competition, increasing container shipping order book.

Upside risks are: a stronger rebound in global trade drives higher freight rates, greater-than-expected capacity reductions by competitors, lower-than-expected bunker fuel prices, greater-than-expected cost savings, digitization increases productivity.

ASMI (ASMXF)

We have set a 595 PO. We think ASMI should trade at a premium to its deposition peers, on average, given its strong positioning in ALD and epitaxy, two of the fastest growing WFE markets. We forecast a 26% EBITDA CAGR 2021-23E and hence apply a 30x FY23E EV/EBITDA multiple, equivalent to 1.2x EBITDA CAGR which we see as fair.

Upside risks to our PO are: 1) Higher-than-expected demand for ALD/Epitaxy machines, 2) higher margin leverage than we currently expect, 3) Stronger-than-expected Semi Capex environment driven by macroeconomic trends. Downside risks to our PO are: 1) reduced demand due to delays in technology transitions at customers and US/China tech/trade war, 2) Weaker-than-expected Semi Capex.

ASML Holding N.V. (ASMLF / ASML)

We have set an 846 ($956 for the ADR) PO. We use a 32x FY23E EV/EBITDA to derive our PO (1.4x EBITDA CAGR). We expect ASML's premium valuation to continue given dominant position in EUV and our expectations of 23% EBITDA CAGR '21-23E.

Upside risks to our PO are:
1) Higher-than-expected demand for EUV and DUV machines
2) Higher-than-expected gross margins on EUV machines and services
3) Stronger-than-expected Semi Capex environment driven by macroeconomic trends and higher capital intensity per wafer.

Downside risks to our PO are:
1) Delays in ramping volume shipments of EUV machines
2) Lower-than-expected gross margins on EUV machines
3) Weaker-than-expected Semi Capex driven by macro slowdown/oversupply

Associated British Foods plc (ASBFF / ASBFY)

Our PO is based on the average of DCF and peer-based SOTP valuation analyses. Combined, these lead to a PO of 1,765p. At our PO, ABF would trade at 13.5x FY22E P/E - a 10% premium to MSCI Europe index (vs. a c.30% premium over the past five years on average). We think the stock deserves to trade at a discount to its historical average given deteriorating LFLs and returns in its core business, Primark. Our two-stage DCF analysis implies a fair value of 1,694p. Stage one (FY22-28E) of our model reflects our near-term estimates, while stage two (FY29E-FY30E) is based on steady-state assumptions to the terminal date. We assume a WACC of 9.5% (including an RfR of 1.5% and ERP of 8%) and terminal growth of 0.25%. Our SOTP analysis implies a fair value of 1,835p. We apply market-based multiples to ABF's segments, with a discount determined by our benchmarking analysis on growth and margins. We apply the following multiples - 1) Retail. We apply a 6x EV/EBIT multiple. This is a 50% discount to the average of H&M, Inditex and NEXT. 2) Grocery. We apply a 10x EV/EBIT multiple. This is a 30% discount to the average of Danone, Nestle, Unilever and Orkla. 3) Sugar. We apply a 12x EV/EBIT multiple. This is broadly in line with Suedzucker. 4) Agriculture. We apply an 13x EV/EBIT multiple, in line with the average of Bunge and ADM. 5) Ingredients. We apply a 14x EV/EBIT multiple. This is a 20% discount to Tate & Lyle. 6) Central costs. We apply a 10x EV/EBIT multiple - which we deem fair.

AutoStore (XETRF)

Given the superior growth and margin profile for AutoStore compared to the Industrial Software group over the medium term, we think a premium valuation to these companies is justified. We opt to use our traditional valuation metric for the sector, EV/EBIT, and apply a 20% premium to the Industrial Software 2024E EV/EBIT (26x) to capture the strong growth expected by AutoStore at above average margins medium-term, discounting back to 2023 to derive our PO of NOK44.

Upside risks are: faster-than-expected growth in warehouse automation, higher online penetration rates driving growth in eCommerce, higher-than- expected growth rates within Cubic Storage.

Downside risks are: lower-than-expected growth in warehouse automation penetration rates, quality issues with AutoStore systems, unfavourable outcomes from Ocado litigation.

AVEVA (AVEVF)

Our valuation and PO of £48 per share is based on a DCF model, assuming 3% long term growth, 37.8% long term EBIT margins, and a 7.0% WACC.

Upside risks to our price objective are rising oil prices leading to increased investment in oil exploration and better than expected results of AVEVA's integration with OSIsoft

Downside risks are a fall in the oil price leading to weaker demand in the company's core industry, technical issues with integration of a complex portfolio of assets at OSIsoft and a change in attitude from Schneider Electric leading to it seeking to sell down its share holding.

BASF (BFFAF / BASFY)

Our PO of EUR58 (US$16) is a rounded blend of 12x 2023E P/E (EUR62) in line with the average 10 year trading multiple, an EV/EBITDA-based sum of the parts valuation (EUR53) implying 7.1x EBITDA ex the oil assets, 1.4x p/book (EUR62) and a target FCF yield of 7% 2023 (EUR53) inline with peers. We believe such multiples reflect the growth profile, capital structure and risk characteristics of the company. To contextualise the book multiple, it assumes a sustainable 11% ROE with 9% discount rate and 1% perpetual growth rate.

Upside risks: an improvement in global cyclical conditions relative to our expectations, for example due to a US-China trade truce, a faster than expected portfolio shift to more resilient, specialty niches, larger than expected proceeds from planned disposals in construction chemicals and upstream oil & gas, and delays to large competitor capacity additions in key product areas.

Downside risks: continued deterioration in global cyclical conditions, for example due to a further US-China trade war escalation, slower than expected progress on the company's restructuring, reinvestment of disposal proceeds into dilutive M&A, in line with company's poor track record on inorganic value creation, and faster than expected supply additions in key product areas.

BE Semiconductor Industries N.V (BESVF)

We value Besi at a price objective of 160 based on 21x 2025E EV/EBITDA, consistent with 22% EBITDA CAGR 2021-25E (i.e. c1x PEG). We then discount this back to 2023 at a 7.5% WACC. This equates to a 26x 2023E EV/EBITDA, a premium to its last three year average (18x) and at the upper-end of European front-end peers ASML, ASMI and VAT at 17-27x 2023E EV/EBITDA. We believe Besi shares will re-rate given its dominant market share in hybrid bonding, a transformational chip making technology about to take-off. Further, we expect hybrid bonding to trigger an inflection in capital intensity for Besi and a re-rating of the stock, consistent with the re-rating of front-end peers when capital intensity inflected upwards.

Upside risks:
1. Higher-than-expected demand for die-attach machines.
2. Faster than expected hybrid bonding adoption.
3. Higher than expected market share gains.
4. Higher-than-expected gross margins on new equipment sales.
5. Stronger assembly market growth for multiple years driven by significant back-end investments.
6. Stronger semiconductor cycle than expected driving multi-year record unit growth.

Downside risks:
1. Weaker than expected hybrid bonding adoption.
2. Market share losses in Besi's existing markets.
3. Weaker than expected operating margin leverage.
4. Larger assembly market declines driven by lower semiconductor unit growth than expected.

Big Yellow (BYLOF)

We use four valuation metrics to derive our PO of 1,900p. In our view these metrics provide a balanced view of the different returns from capital and income: economic value added EVA (for the ROIC), P/BV (for the ROE), the discounted dividend model DDM (for the total property return) and a discounted free cash flow model DCF (for the ROCE). For each method we use the same CoE of 5.7% (previously 5.4%) and WACC of 5.3% (previously 4.9%).

We average the fair values from each method and round the total to arrive at our PO of 1,900p - see values for each valuation method below.
DCF fair value 1,782p (1,924p)
DDM fair value of 1,694p (1,589p)
P/BV fair value of 2,371p (2,100p)
EVA fair value of 1,680p (1,582p)

Upside risks are: 1) stronger demand for storage space due to WFH and online business growth 2) better-than-expected rent achieved in newly opened stores.
Downside risks are: 1) a weaker UK economy and/ housing market resulting in a structural rise in vacancy and consequently in prices. 2) slowing demand for storage space from WFH 3) intense competition for land from industrial players.

Cofinimmo (CFMOF)

We use an average of four valuation metrics to derive our PO of 160. In our view these metrics provide a balanced view of the different returns from capital and income: economic value added EVA, P/BV, the discounted dividend model DDM (for the total property return) and a discounted free cash flow model DCF (for the ROCE). For each method we use the same CoE of 7.9% and WACC of 5.3%. Overall, our valuation is balanced between capital return (45%) and income return (55%).

We average the fair values from each method and round the total to arrive at our PO of 160 - see values for each valuation method below.
DCF. We derive a fair value of 116
DDM. We derive a fair value of 182
P/BV. We derive a fair value of 193
EVA. We derive a fair value of 147

Upside risks are 1) better-than-expected inflation growth which will push up rental income. 2) healthcare operators deliver stronger financial performance.

Downside risks are a 1) lower than expected inflation resulting in lower rental growth and less investment yield compression than expected. 2) tightening regulation in the healthcare industry or tenant/operator insolvencies, and 3) major changes in tenants' and regulatory ESG requirements for healthcare buildings.

Colonial (IMQCF)

We use an average of four valuation metrics to derive our PO of 8.5p/s. These metrics provide a balanced view of the income and capital components of any real estate company's returns: economic value added EVA (for the ROIC), P/BV (for the ROE), the discounted dividend model DDM (for the total property return) and a DCF (for the ROCE). For each method we use the same CoE of 6.6% (previously 6.8%) and WACC of 5.2% (previously 5.0%). Overall, our valuation is equally weighted between capital return and income return. We average the fair values from each method and round the total to arrive at our PO of 8.5p/s.

DCF, we derive a fair value of 2.3p/s (7.0p/s)
DDM, we derive a fair value of 11.8p/s (9.3p/s)
P/BV, we derive a fair value of 10.1p/s (9.7p/s)
EVA, we derive a fair value of 8.9p/s (7.2p/s)

Upside risks are 1) lower than expected long term impact from the pandemic in Colonial's core markets. 2) Higher office demand will result in prolonged structural rental tension driving investment yield down. 3) For Spanish assets (c.50% of portfolio) a better outlook of the Spanish economy and the labour market could also put additional pressure on office demand.

Downside risks are 1) Vacancy rates in Madrid and Barcelona CBDs exceeding 5% would add downward pressure to property prices and potentially increase Colonial's LTV. 2) Also achieving lower rents in development projects could deduct NAV gains from the pipeline.

Dassault Systemes (DASTF / DASTY)

Our valuation and PO of 57.5 / US$65.65 per share is based on a DCF model, assuming 3% long term growth, 29.6% long term EBIT margins, and 5.9% WACC.

Upside risks to our price objective are (1) increasing traction of 3DX driving faster growth, and (2) successful expansion into new verticals.

Downside risks are (1) slowing capex spending in the automotive/aerospace sectors, dampening growth, and (2) product delays meaning that its new products do not launch on time

Derwent London plc (DWVYF)

We use an average of four valuation metrics to derive our PO of 3,800p. These metrics provide a balanced view of the income and capital components of any real estate company's returns: economic value added EVA (for the ROIC), P/BV (for the ROE), the discounted dividend model DDM (for the total property return) and a discounted free cash flow model DCF (for the ROCE). For each method we use the same CoE of 5.8% (previously 5.4%) and WACC of 5.1% (previously 4.8%). We average the fair values from each method and round the total to arrive at our PO of 3,800p. - see values for each valuation method below.

DCF, we derive a fair value of 3,178p (3,519p)
DDM, we derive a fair value of 4,418p (4,556p)
P/BV, we derive a fair value of 3,257p (3,571p)
EVA, we derive a fair value of 4,265p (4,296p)

Upside risks to our investment case are: 1) Lower impact from the Covid-19 recession on both retailers and office workers and 2) a stronger demand on flexible office which helps to push up ERV.

Downside risks to our investment case are: 1) Stronger than expected impact from the pandemic crisis on London offices resulting in a structural rise in vacancy and investment yield expansion. 2) the weakening of London office rents because of Brexit, putting pressure on capital values, and 3) an increase in construction costs, both for labour and materials.

DNB (DNBBF)

Our PO of NOK245 is derived from a sum-of-the-parts Gordon growth model, based on 2023E profits, allocating a CoE and growth rate to each division (with an average CoE of 8.5% and average growth rate of 2.2%) and adding excess capital at 1x.

Risks:
Macro slowdown: Further deterioration of the COVID-19 with negative effects on unemployment levels and GDP growth and/or weaker-than-forecast economic developments in one of its core markets would negatively affect the revenue and asset quality outlook.
Revenues: A prolonged slowdown in corporate lending and sustained pressure on the interest rate outlook could weigh on revenues.
Asset quality: A significant fall in oil prices would erode DNB's oil & gas portfolio.
Finally, if div payments do not unfold as planned.

DSV (DSDVF)

Our PO (based on a multiple analysis) of DKK1,870 per share assumes a 30x P/E multiple on 2023E EPS, including Agility GIL. This is above its historical average of 26x as returns and margins improve post the integration of Agility, and we see scope for further share buybacks.

Upside risks are a stronger than expected macroeconomic recovery, stronger than expected air and sea yields, further shareholder returns, higher than expected margins from the integration of Agility GIL and M&A.

Downside risks are weaker than expected macroeconomic recovery, no share buyback, failure to integrate Agility GIL acquisition, yield pressure from de-globalization, competition from digital forwarders, failure to close Global Integrated Logistics acquisition.

Equinor ASA (STOHF / EQNR)

Our price objective is defined by DCF-based valuation using our base case $70/bbl for long-term Brent oil prices. We also include our bottom-up Renewables valuation at a 0% discount. We use in both cases a WACC of 7.1%. Weighting the base and bear case 50/50 gives us a PO of NOK425 (USD47.22).

Downside risks to our price objective are a significant change in the price of oil or natural gas prices, currency, government regulatory or fiscal intervention, unforeseen circumstances with operation. Upside risks are: lower capex than expectations, further cost efficiency gains and exploration success.

Hammerson (HMSNF)

We use an average of four valuation metrics to derive our PO of 28p. In our view these metrics provide a balanced view of the income and capital components of any real estate company's returns: economic value added EVA (for the ROIC), P/BV (for the ROE), the discounted dividend model DDM (for the total property return) and a discounted free cash flow model DCF (for the ROCE). For each method we use the same CoE of 7.8% and WACC of 6.4%. Overall, our valuation is more weighted towards capital return than income return as asset value declines are a major driver of future value.

We average the fair values from each method and round the total to arrive at our PO of 28p. - see values for each valuation method below.
DCF, we derive a fair value of 20p
DDM, we derive a fair value of 38p
P/BV, we derive a fair value of 29p
EVA, we derive a fair value of 26p

Downside risk to our PO: 1) less disposals, or at below our forecasts. 2) Faster and more negative decline in retail asset values in France and Ireland. 3) delayed and unsuccessful development of Hammerson's 'city quarters' would also decrease our valuation.
Upside risks to our PO: 1) earlier and larger disposals at higher price than forecasted. 2) Quicker earnings recovery from store reopening and return of tourists in Value Retail.

HENSOLDT AG (HNSDF)

Our PO of EUR28.1 is based on an average of 2023-24 PE and EV/EBITA multiples discounted back to 2022. We use a target PE multiple of 16.1x, and a target EV/EBITA multiple of 13.8x, a 15% premium to our assumed mid-cycle multiples of HENSOLDT. We average all four target valuations to derive our PO of EUR28.1. We think this is fair given the high leverage despite the strong order book and growth outlook.

Upside risks are: 1) continued strong order momentum, 2) strong execution leading to better than expected cash, 3) development of a large scale and long term conflict that support higher defence spending.

Downside risks are: 1) significant decrease to German or NATO defence budgets, below our current assumptions, 2) execution issues that cause charges/provisions to be taken.

Hexagon AB (HXGBF)

Our price objective is SEK160. This is based on applying a 10% discount relative to software peers (29x 2023E EV/EBITA) and a 10% premium to quality capital goods (22x EV/EBITA). We think the premium is justified by 60%+ software/service mix in the business vs. broader capital goods universe and superior margin performance relative to the industrial sector, and the discount due to lower software mix and margins relative to software peers.

Downside risks to our price objective are a lower level of industrial software spending, in China and globally, deterioration in US-China trade talks, incremental headwinds in oil & gas in Process, Power & Marine and dilution from weak or expensive M&A.

Inditex (IDEXF)

Our price objective for Inditex of EUR21 is based on DCF analysis overlaid with implied multiples. Our DCF valuation of EUR21/share uses a WACC of 8.5% and a terminal growth rate of 2.0%. At our PO Inditex would trade on 25x 2022 P/E (Dec YE adj), which is in line with its historical average.

Risks to the upside are if Inditex outperforms its major markets by more than we anticipate or if Inditex's costs rise by less than we expect.

Risks to the downside are if Inditex is impacted by a weakening in consumer demand in its major markets, or if the Euro strengthens materially further against other currencies. Like any fashion retailer, Inditex faces a certain amount of weather and fashion risk.

Infineon Technologies AG (IFNNF / IFNNY)

Our 47 (US$53 ADR) PO is based on 14x FY23E EV/EBITDA, at the upper end of its peer group range of 6x-16x given its superior EBITDA CAGR we model over the next two years vs its global peer average. Our positive view is further based on i) leading positions in large, long growth duration automotive and Industrial semiconductor markets, ii) best-in-class, low-cost 300mm manufacturing, iii) optionality with growth/margin accretive expansion into IoT markets

Downside risks to our PO are: 1) Adoption of electric vehicles and advanced driver assistance systems (ADAS) is slower than we expect. 2) Much faster than expected SiC adoption in EVs where IFX are relatively less well positioned. 3) ongoing chip shortages could cause double ordering, resulting in order push-outs when lead times normalise. 4) Potential damages awarded to Qimonda's administrator over and above current estimates by the company. 5) High CAPEX requirement through 2025E means that cash conversion will likely remain worse than peers for the foreseeable future. 6) EUR/$ strengthening, with every 1c appreciation of the euro vs US$ negatively impacting revenue by Eur13m, 7) Synergies from the Cypress acquisition are realised slower than we currently expect.

Kingspan Group PLC (KGSPF)

Our PO of EUR120 is based on 35x 2022-2023E EPS and 23x 2022-2023E EBITDA. We believe that the valuation multiples are about 50% above the average multiple in the last seven years, reflecting the rerating on high quality cyclical stocks with strong ESG credentials. On average, the stock has traded at a 40% premium multiple to the UK market. We anticipate that Kingspan will continue to grow revenue and profit at a premium rate as it reinvests its cash flow in organic and M&A led growth. Its track record to date would suggest that it has been successful over the long term in achieving these goals.

Upside risks are accelerated economic growth and further M&A activity, whilst we consider a macro slowdown as downside risk, along with limited M&A activity.

Klepierre (KLPEF)

We use four valuation metrics to derive our PO of 15. In our view these metrics provide a balanced view of the different returns from capital and income: economic value added EVA (for the ROIC), P/BV (for the ROE), the discounted dividend model DDM (for the total property return) and a discounted free cash flow model DCF (for the ROCE). For each method we use the same CoE of 9.3% and WACC of 6.8%.

We average the fair values from each method and round the total to arrive at our PO of 15 - see values for each valuation method below.
DCF fair value 10
DDM fair value of 19
P/BV fair value of 23
EVA fair value of 10

Upside risks to our price objective are lower-than-anticipated fall in asset values, i.e. less pressure on leverage, meaning fewer necessary disposals

Downside risk to our price objective are: a higher than expected decline in retail rents and/or higher yield expansion leading to a higher fall in asset values. This could, combined with a lower than expected disposal volume, lead to rising leverage and potential equity measures to repair the balance sheet.

Land Securities (LSGOF)

We use an average of four valuation metrics to derive our PO of 870p. In our view these metrics provide a balanced view of the income and capital components of any real estate company's returns: economic value added EVA (for the ROIC), P/BV (for the ROE), the discounted dividend model DDM (for the total property return) and a discounted free cash flow model DCF (for the ROCE). For each method we use the same CoE of 7.4% (7.2% before) and WACC of 6.0% (5.5% before). Overall, our valuation is more weighted towards income return (59%) than capital return (41%).

We average the fair values from each method and round the total to arrive at our PO of 870p. - see values for each valuation method below.
DCF, we derive a fair value of 530p (563p)
DDM, we derive a fair value of 1,045p (1,013p)
P/BV, we derive a fair value of 935p (962p)
EVA, we derive a fair value of 963p (967p)

Upside risks to our investment case are: 1) Higher development profit margin due to stronger demand for prime office and mixed-use space, and 2) faster retail recovery which helps stablise portfolio valuation.

Downside risks to our investment case are: 1) Higher impact from the corona virus pandemic for London offices, increasing vacancy of the office portfolio, 2) delayed and below our forecast disposal of subscale sectors, and 3) lower profitability of the development due to inflation cost.

LEG Immobilien (LEGIF)

We use an equal weighting of four valuation metrics to derive our PO of 150. In our view these metrics provide a balanced view of the income and capital components of any real estate company's returns: economic value added EVA (for the ROIC), P/BV (for the ROE), the discounted dividend model DDM (for the total property return) and a discounted free cash flow model DCF (for the ROCE). For each method we use the same CoE of 6.2% and WACC of 4.6%. Overall, our valuation is equally weighted between income return (50%) and capital return (50%).

We average the fair values from each method and round the total to arrive at our PO of 150- see values for each valuation method below.
DCF, we derive a fair value of 139 (237)
DDM, we derive a fair value of 155 (135)
P/BV, we derive a fair value of 174 (190)
EVA, we derive a fair value of 141 (117)
Upside risks are: 1) stronger recovery of residential fundamentals 2) lower-than-expected modernization capex required

Downside risks are: 1) a worse than expected impact from the corona virus pandemic on residential rents and employment rate, falling property values, 2) more restrictive rent legislation, higher maintenance costs and 3) lower NAV growth than forecasted.

MERCEDES-BENZ GR (XQEJF / DDAIF)

Our price objective of 85 (USD96.93 ADR) is based on our sum-of-the-parts analysis. We base our valuation on the years 2022-24e. We value Daimler based on EV/Sales, EV/EBIT and P/E and use the average to arrive at our price objective. For MB Cars and Vans we assign EV/Sales of 0.3x and EV/EBIT of 3.0x, which is a premium to Audi & BMW. Overall, we assign a (clean) P/E of 7.0x at group level.

Upside risks: 1) Usual market demand related to upside risk, 2) Overestimation of negative impact from Coronavirus, 3) Underestimation of Daimler's ability to offset rising Co2 content costs through efficiency gains and pricing.

Downside risks: 1) Usual market demand related to downside risk, 2) Underestimation of impact from Coronavirus, 3) Unexpected FX and raw material price changes, 4) Overestimation of Daimler's ability to offset rising Co2 content costs through efficiency gains and pricing, 5) Risk of missing CO2 targets in the EU (or China), 6) Ongoing legal proceedings regarding the diesel issue could result in higher fines and damage claims lower/higher than we forecast.

NatWest Group (RBSPF)

Our price objective for NatWest is 335p. Our primary valuation approach is a Gordon Growth model based on the outer year of our forecast period to which we add the present value of expected capital return. We then cross check this against sector PE multiples and our economic scenario analysis. We use 2024E as the base year for our model. With an 11% cost of equity, this suggests a 2024E price to book multiple of 1.1x, reducing to 0.9x when discounted to a year from now at our cost of equity. Applying this to 2022E tangible book value of 283p gives a value of 232p pre capital return. To this we add the present value of the dividends and share buybacks that we forecast through to 2024E.

Downside risks to our price objective are weaker earnings than anticipated from higher impairment losses if the UK economy performs worse than we presently expect, a weaker interest rate outlook, more significant restructuring, tougher regulation and/or increased competition.
Upside risks are a stronger economic recovery, including interest rate and growth prospects, offering revenue upside and reduces credit risk. A more constructive pricing environment would be a further positive..

Neste (NTOIF)

Our price objective of EUR48 is based on DCF valuation. We use a 5.6% discount rate, and a 3% long-term growth rate.

Upside risks to our PO are: (1) a faster-than-expected societal shift towards clean energy, (2) increased regulatory support for renewable diesel/jet, and (3) higher-than-expected European refining margins. Downside risks to our PO are: (1) removal of regulatory/policy support from biofuels, (2) other competitive renewable diesel technologies emerging, and (3) lower-than-expected European refining margins.

Outokumpu (OUTFF)

Our price objective of EUR 5.60 is based on 4.5x 12mnth fwd EBITDA. This is below long run average which we view as appropriate given the above-normal earnings and our declining margin forecast

Upside risks to our PO are:
1) Stronger than expected global stainless steel demand
2) Better than expected European pricing following trade protectionism measures in place
3) Group Americas business surprise to the upside

Downside risks to our PO are:
1) Weaker than expected global stainless steel demand.
2) Raw material cost move in the adverse direction

Pod Point (XSWTF)

We use a SotP valuation approach to derive our 450p PO given Pod Point has two different business models: 1) sale and installation of Home and Commercial charging units and 2) recurring revenue and network-type business models (Recurring & Owned Assets). In both cases, there are suitable listed peers from which to derive a comparable valuation on EV/Sales for 2023E. For Home & Commercial revenues we apply a c4x 2023E EV/Sales multiple and 12x for Recurring Revenue and Owned Assets. We then discount back one year to derive our PO.

Upside risks are faster than expected EV penetration rates, increased development of recurring revenue streams and higher utilisation rates of the owned asset portfolio.

Downside risks are slower EV adoption rates, execution issues and slower deployment of owned asset strategy, limited traction of recurring revenue streams.

Rheinmetall AG (RNMBF)

Rheinmetall has a distinctive business profile in that its profits are shared between Auto and Defence. Consequently, pure-play automotive or aerospace and defence stocks are not appropriate comparables, in our view.

Our price objective of 220 is derived from an SOTP-based valuation using 2024E EV/EBIT multiples discounted back one year. We use an 12.7x EV/EVBIT on Defence, and 6.8x on Automotive earnings. We apply a 15% premium to Defence peers reflecting Rheinmetall's superior growth and a 15% discount to Auto supplier peers due to lower growth/margins.

We apply a 20% conglomerate discount reflecting the value drag from the automotive business on the group.
Downside risks to our PO are: A slowdown in global Defence spending and/or RHM's inability to take a reasonable share of growing budgets, especially in Germany. In Auto, a slowdown from deteriorating economic environment, raw material headwinds and OEM price-downs would reduce profitability. Faster penetration of pure electric vehicles would ultimately reduce RHM's addressable content.

RWE (RWNFF / RWEOY)

We set our 55 (US$62.26) price objective for RWE based on a pro forma NAV valuation of existing conventional and renewables generation assets, using 4.5-6.7% WACC, and a DCF valuation of future renewables growth through to 2050, assuming 50-150bps IRR value creation.

Risks to our PO are volatility in the value of RWE's 15% stake in E.On, volatility in future power and gas prices. We see additional downside risks if RWE fails to deliver a sufficient rate of growth in renewables at attractive returns, for example due to increased competition. We see upside if RWE can accelerate its exit from legacy hard coal assets.

SAAB AB (SAABF)

Our SEK400 price objective is derived from an equal weight combination of 2023E-2024E PE and EV/EBIT multiples discounted back to 2022 using a sector applied 8% WACC. We use target multiples of 16.1x and 17x, respectively, and apply a 15% premium to these through-cycle average multiples. We think this is fair now that SAAB appears to have reached the trough in the negative COVID earnings revision cycle.

Risks to our price objective are a deteriorating environment for global defence budgets and/or a failing to secure large export orders.

Saint-Gobain (CODGF)

Our price objective of 78 for Saint-Gobain is based on target P/E and EV/EBITDA multiples of 14x and 8x, respectively, at a limited premium to the group's historical average multiples, reflecting improving fundamentals: support from the European Green deal, better free cash flow generation and upside from acquisitions. We apply these multiples to our 2023 earnings forecasts (from 2022 previously).

We see the following risks to our price objective on Saint-Gobain. Upside risks to our PO are: 1) improving European housing volumes, 2) further recovery of flat glass prices and margins, 3) incremental cost-cutting initiatives. Downside risks are: 1) downturn in flat glass prices, 2) lack of recovery in European housing volumes in 2022-23, 3) a surge in energy costs.

Salzgitter (SZGPF)

Our price objective of EUR 22 is based on c. 4.5x EV FY23E EBITDA, c.1 Std Dev below historical trading average reflecting peak earnings. We adjust for SZG's stake in Aurubis (estimated to be 25% stake) at market value with an assumed 10% holdco discount.

Upside risks to our price objective are a faster-than-expected recovery in European GDP, a stronger-than-expected volume recovery in the European construction market (particularly civil engineering and heavy construction) and an increase in energy pipeline projects. Downside risks are renewed price deflation in European steel, a longer-than-expected/permanent loss of business from Oil & Gas, a significant decline in European automotive demand for steel and Salzgitter's large pension liability.

Segro (SEGXF)

We use an average of four valuation metrics to derive our PO of 1,450p. In our view these metrics provide a balanced view of the different returns from capital and income: economic value added EVA (for the ROIC), P/BV (for the ROE), the discounted dividend model DDM (for the total property return) and a discounted free cash flow model DCF (for the ROCE). For each method we use the same CoE of 5.8% and WACC of 5.1% . Overall, our valuation is slightly more weighed towards capital return (60%) than income return (40%) as we expect total return to be driven by development gains and yield compression.

We average the fair values from each method and round the total to arrive at our PO of 1,450p - see values for each valuation method below.
DCF. We derive a fair value 935p
DDM. We derive a fair value of 1,857p
P/BV. We derive a fair value of 1,324p
EVA. We derive a fair value of 1,692p

Upside risks are 1) stronger growth in online business 2) growing appetite in investment pushes down yield further.
Downside risks are 1) the weakening of the wider economy following the corona virus pandemic than expected, 2) lower online sales and less investors' appetite for the asset class resulting in lower rental growth and 3) less investment yield compression than expected.

Shell Plc (RYDAF / SHEL)

Our price objective of 2750p/share (US$72/ADR) is based on our sum-of-the-parts valuation breaking Shell up into its constituents (upstream, downstream and others). We value these separately from our bottom-up cash flow model via a DCF valuation based on differentiated discount rates (8.4% for Upstream, 10.0% for Downstream, 5.4% for Renewables, 8.7% Group and others). Our divisional DCF valuations are usually based on zero-growth perpetuity assumptions beyond 2030 - except for Shell's and legacy BG E&P assets: Here we run a "depletion DCF" and disregard both the income and capex attributable to future prospects while using our long-term Brent oil price assumptions of $70/bbl.

Risks are: Changes in oil & gas prices, political / regulatory risks as well as significant exploration success or lack thereof. Other risks are exposure to swings in the global economy that could impact oil and gas prices as well as refining margins, currency moves for the US dollar, general risks of changes in taxes and tariffs and rising capex costs.

Shurgard Self Storage (SSSAF)

We use four valuation metrics to derive our PO of 51. In our view these metrics provide a balanced view of the different returns from capital and income: economic value added EVA (for the ROIC), P/BV (for the ROE), the discounted dividend model DDM (for the total property return) and a discounted free cash flow model DCF (for the ROCE). For each method we use the same CoE of 6.2% and WACC of 5.4%.

We average the fair values from each method and round the total to arrive at our PO of 51 - see values for each valuation method below.
DCF fair value 47
DDM fair value of 48
P/BV fair value of 70
EVA fair value of 39

Upside risks are: 1) larger asset price growth than forecast 2) as well as larger acquisitions and lower tax rate.
Downside risks are: 1) a weakening of the wider economy, fewer acquisitions and new openings than forecast, and 2) less investors' appetite for the asset class resulting in lower rental growth and 3) less investment yield compression than expected.

Siemens (SMAWF / SIEGY)

Our PO of EUR207 (US$114.35 for the ADR) is derived from a Sum of the Parts analysis in light of the spinoff of Energy & the inherent discount in the market valuing Digital Industries. We apply a 19x EV/EBITA multiple to Digital Industries (DI), 13x to Smart Infrastructure (SI) and 13x to Mobility. These multiples reflect market leadership (DI), margin improvement potential (SI), and industry leading margins and backlog visibility (Mobility). We apply our target sector multiple (13x) to capitalise "normalised" restructuring costs, central eliminations and severance costs. We apply a 10% holding company discount.

Downside risks to our price objective are (i) weakening demand in the automation and Energy divisions, (ii) lack of delivery on FCF conversion improvement, and (iii) lack of capital discipline.

Siemens Energy AG (SMEGF)

Our PO of EUR36 is derived from a Sum of the Parts analysis in light of the investor debate around the long-term prospects for Generation, the high margins/visibility in the Service business, and the fact that ENR owns 67% of SGRE.

We value Generation/Industrial Applications/Transmission at 8x/12x/11x 2023E EV/EBITA, reflecting 30% discount/10% premium/in line multiples vs power peer group average (11x). The discount for Generation reflects the difficult long-term prognosis for conventional and centralised power generation as well as low margins relative to the global power peers. The premium for Industrial Applications reflects the above-average margins we expect the division to deliver relative to peers. We forecast Transmission to deliver margins in line with the peer group, hence we apply the peer group average multiple. We include SGRE at the BofA PO of 20/sh

Downside risks to our valuation are i) poor execution hitting profitability and/or cash flow, ii) a return to pricing pressure in large gas turbines, and iii) early retirement risk around the installed fleet potentially impairing the service business.

Signify (SFFYF)

We derive a value per share for the core (DP & DS divisions) growth business of 65, by applying a c10% discount to the target sector multiple (12x) to our 2023e EBITA given we see growth ahead of the sector but with slightly lower margins. We then add in c2/sh derived from a DCF of the Conventional Products business, resulting in our PO of 67.

Upside risks to our PO: slower declines in conventional lighting or faster growth in adoption rates for LED-driven technology. Stronger profitability and restructuring benefits.

Downside risks to our PO: faster declines in conventional lighting or slower growth from LED-driven technology, exacerbated by poor cost management.

Sika (SKFOF)

Our PO of CHF320 on Sika is based on historical average valuation multiples plus a 40% premium applied to our 2024 EBITDA and EPS estimates, which include MBCC Group, to account for the stronger industry and company fundamentals. We apply a 50/50 weighting for each year. The stock has traded historically on a forward P/E of 24x and an EV/EBITDA of 14.5x.

Upside risks to our PO are: 1) a stronger-than-expected sales rebound in 2022 from improvement in construction and market share gains, 2) better-than-expected margins supported by cost cutting and lower commodity prices, 3) new acquisitions, which would boost the group's growth profile.
Downside risks to our PO are: 1) more disruption in the construction and automotive markets which would put pressure on the group's volumes, 2) cost inflation, which could have a short-term negative impact on margins, 3) rising interest rates, which could have a negative impact on the group's valuation multiples, 4) failure of the MBCC deal to complete.

STMicroelectronics NV (STMEF / STM)

We value STM using a FY23E EV/EBITDA of 12x, vs peers on 5-16x reflecting higher Apple exposure and lower cash conversion. Using this multiple, we derive our PO of 64/US$72. Although this is a premium to its historical EV/EBITDA multiple (9x), it is broadly in-line with peers. We think that concerns over the size of its Apple exposure and related loss of a major contract are baked in at the current price. Yet we estimate that the company will outgrow its peers in terms of both sales and EBITDA over the next two years. Hence we would expect a gradual rerating once we have clarity over Apple relationship and the market better appreciates the growth prospects of the company.

Downside risks to our PO are:
1) Weakening macro conditions leading to decreasing demand and destocking which would negatively impact revenues and earnings.
2) Loss of recent design wins at Apple and potential pricing pressure.
3) A strengthening of the EUR/$ rate to >1.20 as the company's earnings/opex would suffer from a weaker US$.

Terna (TERRF)

Our price objective for Terna is EUR8.5 per share based on a sum of the parts valuation. For the core domestic business we use a 3.7% WACC. We value non-regulated activities on an 8x EV/EBITDA multiple based on peer group comparables. We include financial assets, net debt, provisions and minorities at book value.

Upside risks to our PO are: future accretive M&A transactions, better than expected regulation, newly announced cost cutting plans, and a sharp decline in bond yields which would make relative valuation more attractive.

Downside risks to our forecasts and PO are: a significantly worse than expected outcome from the forthcoming regulatory review, a new windfall tax in Italy in response to the recent annulment of the Robin Hood Tax, a sovereign credit crisis in Italy and/or other south European countries and severe deflation impacting the value of the Regulated Asset Base (RAB/RAV).

Thales (THLEF)

Our 130 PO for Thales is based on a blended average of our 2023-24E (discounted back to 2022) multiple framework using an EBITA target multiple of 12.7x, a P/E target multiple of 17.3x, a 15% premium to our assumed mid-cycle average. We think a premium to the through cycle average is fair given the strong recovery outlook.

Downside risks to our price objective are: 1) Weakness of the USD vs. Sterling, 2) Significantly worse-than-expected traffic decline. 3) Slowdown in Global defence spending 4) Slowdown in global civil traffic growth.

Unibail-Rodamco-Westfield (XZESF)

We use four valuation metrics to derive our PO of 45. In our view these metrics provide a balanced view of the different returns from capital and income: economic value added EVA (for the ROIC), P/BV (for the ROE), the discounted dividend model DDM (for the total property return) and a discounted free cash flow model DCF (for the ROCE). For each method we use the same CoE of 9.3% and WACC of 6.0%.


We average the fair values from each method and round the total to arrive at our PO of 45 - see values for each valuation method below.
DCF fair value 16
DDM fair value of 76
P/BV fair value of 41
EVA fair value of 48

Upside risks are: 1) Faster cash flow recovery for retailers post COVID. This would translate into positive rental value growth. 2) lower-than-anticipated fall in asset values, i.e. less pressure on leverage, meaning no need of cutting the dividend and smaller NAV decline.

Downside risks are: 1) a rights issue, dilutive to shareholders, 2) non execution on the expected disposal, 3) greater-than-anticipated rental value contraction and/or drop in asset values.

Vestas (VWSYF)

Our PO of DKK255 is based on a SoTP analysis which we believe appropriately captures the differential between the margins of turbine OEM and service. For the WTG Onshore business, we have attached an EV/EBITA multiple of c15.6x, a 20% premium to the Eu Cap Goods peers average. For the Offshore OE business, we use EV/Sales of 2x, which we think is fair given the strong growth outlook for offshore. For the Service business, we have ascribed a multiple of 20x EV/EBITA, in line with service-heavy Cap Goods companies which we think is fair given the structural growth outlook for the business.

Downside risks to our PO are weak demand leading to price/margin pressure, execution issues in developing new products or delivering orders, competition from Chinese manufacturers, political uncertainties.

Vitesco Technologies (VTSCF)

Our Price Objective of 85/sh is derived using a combination of peer-relative multiple (weighted 75%) and DCF analysis (25%). Our multiples approach applies an average of P/E (10.7x), EV/EBIT (7.4x) and EV/Sales (0.5x - on core technologies) using peer multiples based on suppliers with similar product mix, while our DCF valuation incorporates a WACC of 8.8% and a long-term growth rate of 2%. Since the non-core business is expected to continue at break even during our forecast period, we attach a zero valuation.

Downside risks: 1. Lower than expected LV production negatively impacting volume efficiencies and cost absorption, 2. Material contract/market share losses on key components which would negatively impact volumes, 3. Shortages or sharp price increases in key raw materials or components such as rare earth metals or semi-conductors could negatively impact volumes and/or margins, 4. Potential fines/legal settlements stemming from investigations into the alleged use of illegal defeat devices in diesel engines and the potential for related civil proceedings

Upside risks: 1. Faster than expected growth in global LV production and/or Faster EV penetration driving higher volumes. 2. Better than expected execution on mid-term targets and margin expansion. 3. Market share gains on new product platforms.

Vonovia SE (VNNVF)

We use an equal weighting four valuation metrics to derive our PO of 57 (70 before). In our view these metrics provide a balanced view of the different returns from capital and income: economic value added EVA (for the ROIC), P/BV (for the ROE), the discounted dividend model DDM (for the total property return) and a discounted free cash flow model DCF (for the ROCE). For each method we use the same CoE of 6.1% (5.4% before) and WACC of 4.6% (4.2% before).
We average the fair values from each method and round the total to arrive at our PO of 57 - see values for each valuation method below.
DCF fair value 58 (66)
DDM fair value of 62 (65)
P/BV fair value of 61 (89)
EVA fair value of 46 (61)

Upside risks are: 1) strong German resi fundamentals pushes up rental growth 2) lower-than-expected modernization capex required.

Downside risks are: 1) a greater weakening of the German economy than expected following the corona virus pandemic, tighter rent regulation, lower population growth, 2) forced sale of assets to public entities and less investment yield compression than expected. 3) Pending DWNI offer does not proceed as expected.

Yara (YRAIF)

Our price objective of NOK360 is based on a blend of four approaches:
(1) A divisional DCF-based SOTP using an 8.5% WACC and average long-term growth rate of 2.0%
(2) 5.9x 2023E EV/EBITDA target multiple - 35% discount to SXXP, towards bottom end of -50% to +40% historical range given shift up cost curve (higher European gas prices) and short-term over-earning
(3) 9.1x 2023E P/E target multiple - 35% discount to SXXP, towards bottom end of -50% to +10% historical range given shift up cost curve (higher European gas prices) and short-term over-earning
(4) 1.5x 2023E P/B - reflecting 13.5% mid-cycle ROE, 9.5% cost of equity and 2.0% terminal growth rate.

Upside risks to our PO are: (1) higher fertiliser prices than we forecast, (2) lower European gas prices than we assume, (3) higher crop prices than we expect, (4) greater capital discipline than we believe management will deliver, (5) better returns on green ammonia than we forecast, (6) weaker EUR, NOK or BRL vs USD, and (7) better operational execution than we assume.

Downside risks to our PO are: (1) lower fertiliser prices than we forecast, (2) higher European gas prices than we assume, (3) lower crop prices than we expect, (4) less capital discipline than we believe management will deliver, (5) lower returns on green ammonia than we forecast, (6) stronger EUR, NOK or BRL vs USD, and (7) worse operational execution than we assume.

Zalando (ZLDSF)

We use DCF analysis to value Zalando as this allows us to capture the long term elements inherent to the Zalando equity story. Within our DCF analysis, we assume a risk free rate of 1.5%, Equity Risk Premium of 8%, and a Beta of 1.2. Consequently, we calculate a WACC of 11%. We use a terminal growth rate of 3.5%. We also include Zalando's reverse factoring facility in our net debt adjustments. Using this methodology we arrive at a price objective of EUR 40 per share.

Upside risks to our PO are: 1) lower competitive pressure from online and offline retailers, 2) improvement in supply chains, which could lead to more efficient and cheaper freight, plus lower cost inflation.

Downside risks to our PO are: 1) more disruptions on supply chains leading to higher cost pressure for Zalando, which would either have to pass on price increases and face a potential slowdown of growth, or absorb inflation and experience margin compression, 2) a more aggressive move from Amazon into fashion would be a key competition risk, 3) long-term margin targets depend on the success of Zalando Marketing Solutions. Should the division fail to pick up, the company's financial profile would be much less attractive.

 

 

 

EMEA - Aerospace, Defence & Satellite Services Coverage Cluster

Investment rating

Company

BofA Ticker

Bloomberg symbol

Analyst

BUY

 

Airbus

EADSF

AIR FP

Benjamin Heelan

 

AVIO S.p.A

XIYFF

AVIO IM

Benjamin Heelan

 

HENSOLDT AG

HNSDF

HAG GY

Benjamin Heelan

 

Montana Aerospace

XMNMF

AERO SW

Virginia Montorsi

 

MTU Aero Engines

MTUAF

MTX GY

Benjamin Heelan

 

Rheinmetall AG

RNMBF

RHM GY

Benjamin Heelan

 

SAAB AB

SAABF

SAABB SS

Benjamin Heelan

 

Safran SA

SAFRF

SAF FP

Benjamin Heelan

 

Thales

THLEF

HO FP

Benjamin Heelan

 

ViaSat

VSAT

VSAT US

Benjamin Heelan

NEUTRAL

 

BAE SYSTEMS

BAESF

BA/ LN

Benjamin Heelan

 

BAE SYSTEMS

BAESY

BAESY US

Benjamin Heelan

 

Dassault Aviation

DUAVF

AM FP

Benjamin Heelan

 

Kongsberg Gruppen

NSKFF

KOG NO

Benjamin Heelan

 

Leonardo

FINMF

LDO IM

Benjamin Heelan

 

YAHSAT

XDXBF

YAHSAT UH

Benjamin Heelan

UNDERPERFORM

 

Eutelsat

EUTLF

ETL FP

Benjamin Heelan

 

QinetiQ

QNTQF

QQ/ LN

Benjamin Heelan

 

Rolls Royce

RYCEF

RR/ LN

Benjamin Heelan

 

Rolls Royce

RYCEY

RYCEY US

Benjamin Heelan

 

Senior Plc

SNIRF

SNR LN

Benjamin Heelan

 

SES

SGBAF

SESG FP

Benjamin Heelan

RSTR

 

Meggitt

MEGGF

MGGT LN

Benjamin Heelan

 

 

EMEA - Autos & Auto Components Coverage Cluster

Investment rating

Company

BofA Ticker

Bloomberg symbol

Analyst

BUY

 

ALD

ALLDF

ALD FP

Horst Schneider

 

Daimler Truck

DTGHF

DTG GY

Michael Jacks, CFA

 

Faurecia

FURCF

EO FP

Michael Jacks, CFA

 

MERCEDES-BENZ GR

DDAIF

DDAIF US

Horst Schneider

 

MERCEDES-BENZ GR

XQEJF

MBG GY

Horst Schneider

 

Pirelli

PLLIF

PIRC IM

Michael Jacks, CFA

 

Renault

RNSDF

RNO FP

Horst Schneider

 

Stellantis NV

STLA

STLA US

Horst Schneider

 

Stellantis NV

XFYKF

STLA IM

Horst Schneider

 

Valeo

VLEEF

FR FP

Michael Jacks, CFA

 

Valeo

VLEEY

VLEEY US

Michael Jacks, CFA

 

Vitesco Technologies

VTSCF

VTSC GY

Michael Jacks, CFA

NEUTRAL

 

BMW

BAMXF

BMW GY

Horst Schneider

 

Continental AG

CTTAY

CTTAY US

Horst Schneider

 

Continental AG

CTTAF

CON GY

Horst Schneider

 

Michelin

MGDDF

ML FP

Michael Jacks, CFA

 

Porsche Automobil Holding SE

POAHF

PAH3 GY

Horst Schneider

 

Volkswagen AG

VLKAF

VOW GY

Horst Schneider

 

Volkswagen AG

VLKPF

VOW3 GY

Horst Schneider

 

Volkswagen AG

VWAGY

VWAGY US

Horst Schneider

 

Volvo

VOLVF

VOLVB SS

Michael Jacks, CFA

UNDERPERFORM

 

Aston Martin Lagonda

AMGDF

AML LN

Horst Schneider

 

Iveco

XCVKF

IVG IM

Michael Jacks, CFA

 

Nokian Tyres

NKRKF

TYRES FH

Michael Jacks, CFA

 

Norma Group

NOEJF

NOEJ GY

Michael Jacks, CFA

 

Schaeffler AG Pfd

SCFLF

SHA GY

Horst Schneider

 

TRATON SE

TRATF

8TRA GY

Michael Jacks, CFA

 

TRATON SE

XTREF

8TRA SS

Michael Jacks, CFA

 

 

EMEA - Banks Coverage Cluster

Investment rating

Company

BofA Ticker

Bloomberg symbol

Analyst

BUY

 

Allied Irish Banks

AIBRF

AIBG ID

Marta Sanchez Romero

 

Banco Bilbao Vizcaya Argentaria

BBVA

BBVA US

Marta Sanchez Romero

 

Banco Bilbao Vizcaya Argentaria

BBVXF

BBVA SQ

Marta Sanchez Romero

 

Banco BPM

BNCZF

BAMI IM

Alberto Cordara

 

Bank Of Ireland Group

XBOIF

BIRG ID

Marta Sanchez Romero

 

Bankinter

BKIMF

BKT SQ

Marta Sanchez Romero

 

BNP Paribas

BNPQF

BNP FP

Tarik El Mejjad

 

BNP Paribas

BNPQY

BNPQY US

Tarik El Mejjad

 

Credit Agricole

CRARF

ACA FP

Tarik El Mejjad

 

DNB

DNBBF

DNB NO

David Taranto

 

Erste Bank

EBKOF

EBS AV

Alastair Ryan

 

Erste Bank

EBKDY

EBKDY US

Alastair Ryan

 

HSBC

XHSBF

5 HK

Alastair Ryan

 

HSBC

HBCYF

HSBA LN

Alastair Ryan

 

HSBC -A

HSBC

HSBC US

Alastair Ryan

 

ING Groep NV

INGVF

INGA NA

Tarik El Mejjad

 

ING GROEP NV

ING

ING US

Tarik El Mejjad

 

Intesa Sanpaolo

IITSF

ISP IM

Alberto Cordara

 

Mediobanca

MDIBF

MB IM

Alberto Cordara

 

NatWest Group

RBSPF

NWG LN

Rohith Chandra-Rajan

 

Nordea

NBNKF

NDA FH

David Taranto

 

Nordea

XSABF

NDA SS

David Taranto

 

Poste Italiane

PITAF

PST IM

Alberto Cordara

 

SEB

SVKEF

SEBA SS

David Taranto

 

StanChart

SCBFF

STAN LN

Alastair Ryan

 

StanChart

XCHBF

2888 HK

Alastair Ryan

 

UBS

XUHJF

UBSG SW

Alastair Ryan

 

UBS

UBS

UBS US

Alastair Ryan

 

Unicredit

UNCFF

UCG IM

Alberto Cordara

NEUTRAL

 

Barclays

BCLYF

BARC LN

Rohith Chandra-Rajan

 

Barclays

BCS

BCS US

Rohith Chandra-Rajan

 

Deutsche Bank

DB

DB US

Rohith Chandra-Rajan

 

Deutsche Bank

XDUSF

DBK GY

Rohith Chandra-Rajan

 

Handelsbanken

SVNLF

SHBA SS

David Taranto

 

KBC Group

KBCSF

KBC BB

Tarik El Mejjad

 

Lloyds Banking Group

LLDTF

LLOY LN

Rohith Chandra-Rajan

 

Lloyds Banking Group

LYG

LYG US

Rohith Chandra-Rajan

 

Raiffeisen Bank International

RAIFF

RBI AV

Alastair Ryan

 

Santander

SAN

SAN US

Marta Sanchez Romero

 

Santander

BCDRF

SAN SQ

Marta Sanchez Romero

 

Swedbank

SWDBF

SWEDA SS

David Taranto

UNDERPERFORM

 

ABN AMRO

ABMRF

ABN NA

Tarik El Mejjad

 

Banco Sabadell

BNDSF

SAB SQ

Marta Sanchez Romero

 

CaixaBank

CIXPF

CABK SQ

Marta Sanchez Romero

 

Commerzbank

CRZBF

CBK GY

Rohith Chandra-Rajan

 

Credit Suisse Group

CSGKF

CSGN SW

Alastair Ryan

 

Credit Suisse Group

CS

CS US

Alastair Ryan

 

Danske Bank

DNSKF

DANSKE DC

David Taranto

 

Societe Generale

SCGLF

GLE FP

Tarik El Mejjad

 

Societe Generale

SCGLY

SCGLY US

Tarik El Mejjad

 

Virgin Money UK PLC

CBBYF

VMUK LN

Rohith Chandra-Rajan

 

Virgin Money UK PLC

CYBBF

VUK AU

Rohith Chandra-Rajan

 

 

EMEA - Building, Construction & Cement Coverage Cluster

Investment rating

Company

BofA Ticker

Bloomberg symbol

Analyst

BUY

 

AENA

ANNSF

AENA SQ

Marcin Wojtal

 

Ashtead Group Plc

ASHTF

AHT LN

Arnaud Lehmann

 

Balfour Beatty

BAFBF

BBY LN

Marcin Wojtal

 

Barratt Developments

BTDPF

BDEV LN

Arnaud Lehmann

 

Berkeley Group

BKGFF

BKG LN

Arnaud Lehmann

 

Bilfinger

BFLBF

GBF GY

John Campbell

 

Cairn Homes

CRRNF

CRN LN

Arnaud Lehmann

 

CRH

CRHCF

CRH LN

Arnaud Lehmann

 

Eiffage

EFGSF

FGR FP

Marcin Wojtal

 

ENAV

EENNF

ENAV IM

John Campbell

 

Ferguson PLC

WOSCF

FERG LN

Arnaud Lehmann

 

Ferguson PLC

FERG

FERG US

Arnaud Lehmann

 

Ferrovial

FRRVF

FER SQ

Marcin Wojtal

 

Fraport

FPRUF

FRA GY

Marcin Wojtal

 

Getlink

GRPTF

GET FP

Marcin Wojtal

 

Kingspan Group PLC

KGSPF

KSP ID

Arnaud Lehmann

 

Persimmon

PSMMF

PSN LN

Arnaud Lehmann

 

Saint-Gobain

CODGF

SGO FP

Arnaud Lehmann

 

Travis Perkins

TVPKF

TPK LN

Arnaud Lehmann

 

Vinci

VCISF

DG FP

Marcin Wojtal

 

Vistry Group PLC

BVHMF

VTY LN

Arnaud Lehmann

NEUTRAL

 

ACS

ACSAF

ACS SM

Marcin Wojtal

 

Atlantia

ATASF

ATL IM

Marcin Wojtal

 

Bellway

BLWYF

BWY LN

Arnaud Lehmann

 

HeidelbergCement

HLBZF

HEI GY

Arnaud Lehmann

 

Holcim Ltd

HCMLF

HOLN SW

Arnaud Lehmann

 

Redrow

RDWWF

RDW LN

Arnaud Lehmann

 

Sika

SKFOF

SIKA SW

Arnaud Lehmann

 

Taylor Wimpey

TWODF

TW/ LN

Arnaud Lehmann

UNDERPERFORM

 

ADP Aeroports de Paris

AEOXF

ADP FP

Marcin Wojtal

 

Flughafen Zurich AG

UZAPF

FHZN SW

Marcin Wojtal

 

Geberit

GBERF

GEBN SW

Arnaud Lehmann

 

Hochtief

HOCFF

HOT GY

Marcin Wojtal

 

Rockwool International A/S

RKWBF

ROCKB DC

Arnaud Lehmann

 

Skanska

SKSBF

SKAB SS

Marcin Wojtal

 

 

EMEA - Chemicals Coverage Cluster

Investment rating

Company

BofA Ticker

Bloomberg symbol

Analyst

BUY

 

AAK

ARHUF

AAK SS

Alexander Jones, CFA

 

Air Liquide

AIQUF

AI FP

Alexander Jones, CFA

 

Air Liquide

AIQUY

AIQUY US

Alexander Jones, CFA

 

Akzo Nobel

AKZOF

AKZA NA

Matthew Yates

 

Akzo Nobel

AKZOY

AKZOY US

Matthew Yates

 

Arkema

ARKAF

AKE FP

Matthew Yates

 

Arkema

ARKAY

ARKAY US

Matthew Yates

 

Atlantic Sapphire

AASZF

ASA NO

Alexander Jones, CFA

 

Bakkafrost

BKFKF

BAKKA NO

Alexander Jones, CFA

 

Croda

COIHF

CRDA LN

Matthew Yates

 

DSM

KDSKF

DSM NA

Matthew Yates

 

DSM

RDSMY

RDSMY US

Matthew Yates

 

Fuchs Petrolub

FUPBY

FUPBY US

Matthew Yates

 

Fuchs Petrolub

FUPPF

FPE3 GY

Matthew Yates

 

Givaudan

GVDBF

GIVN SW

Matthew Yates

 

ICL

XAPLF

ICL IT

Alexander Jones, CFA

 

ICL

ICL

ICL US

Alexander Jones, CFA

 

IMCD

IMDZF

IMCD NA

Matthew Yates

 

K+S

KPLUF

SDF GY

Alexander Jones, CFA

 

Mowi

MNHVF

MOWI NO

Alexander Jones, CFA

 

SalMar

SALRF

SALM NO

Alexander Jones, CFA

 

Solvay

SVYSF

SOLB BB

Matthew Yates

 

Symrise

SYIEF

SY1 GY

Matthew Yates

 

Wacker Chemie

WKCMF

WCH GY

Matthew Yates

NEUTRAL

 

Covestro

CVVTF

1COV GY

Matthew Yates

 

Covestro

COVTY

COVTY US

Matthew Yates

 

Lanxess

LNXSF

LXS GY

Matthew Yates

 

Synthomer

SYYYF

SYNT LN

Matthew Yates

UNDERPERFORM

 

BASF

BFFAF

BAS GY

Matthew Yates

 

BASF

BASFY

BASFY US

Matthew Yates

 

Clariant

CLZNF

CLN SW

Matthew Yates

 

Elementis

EMNSF

ELM LN

Matthew Yates

 

Evonik

EVKIF

EVK GY

Matthew Yates

 

Johnson Matthey

JMPLF

JMAT LN

Matthew Yates

 

Johnson Matthey

JMPLY

JMPLY US

Matthew Yates

 

Novozymes

NVZMF

NZYMB DC

Alexander Jones, CFA

 

Novozymes

NVZMY

NVZMY US

Alexander Jones, CFA

 

Umicore

UMICF

UMI BB

Matthew Yates

 

Victrex

VTXPF

VCT LN

Matthew Yates

 

Yara

YRAIF

YAR NO

Alexander Jones, CFA

 

 

EMEA - Engineering & Capital Goods Coverage Cluster

Investment rating

Company

BofA Ticker

Bloomberg symbol

Analyst

BUY

 

ABB

ABB

ABB US

Alexander Virgo

 

ABB Ltd.

ABLZF

ABBN SW

Alexander Virgo

 

Ariston Group

XRTRF

ARIS IM

George Featherstone, CFA

 

AutoStore

XETRF

AUTO NO

George Featherstone, CFA

 

Epiroc AB

EPIAF

EPIA SS

Vlad Sergievskii

 

Fluidra SA

FLUIF

FDR SQ

George Featherstone, CFA

 

GEA

GEAGF

G1A GY

Uma Samlin

 

Hexagon AB

HXGBF

HEXAB SS

Alexander Virgo

 

IMI

IMIAF

IMI LN

Alexander Virgo

 

KION Group AG

KNNGF

KGX GY

George Featherstone, CFA

 

Knorr-Bremse AG

KNBHF

KBX GY

Vlad Sergievskii

 

Knorr-Bremse AG

KNRRY

KNRRY US

Vlad Sergievskii

 

Melrose plc

MLSPF

MRO LN

Benjamin Heelan

 

Metso Outotec Oyj

OUKPF

MOCORP FH

Vlad Sergievskii

 

Nexans

NXPRF

NEX FP

George Featherstone, CFA

 

Nordex SE

NRDXF

NDX1 GY

Benjamin Heelan

 

Pod Point

XSWTF

PODP LN

Alexander Virgo

 

Rexel

RXLSF

RXL FP

Alexander Virgo

 

Rotork Plc

RTOXF

ROR LN

Vlad Sergievskii

 

Siemens

SMAWF

SIE GY

Alexander Virgo

 

Siemens

SIEGY

SIEGY US

Alexander Virgo

 

Siemens Energy AG

SMEGF

ENR GY

Alexander Virgo

 

Signify

SFFYF

LIGHT NA

George Featherstone, CFA

 

SKF

SKFRY

SKFRY US

Alexander Virgo

 

SKF

SKUFF

SKFB SS

Alexander Virgo

 

Spirax-Sarco

SPXSF

SPX LN

George Featherstone, CFA

 

Vestas

VWSYF

VWS DC

Benjamin Heelan

 

Vesuvius

CKSNF

VSVS LN

George Featherstone, CFA

NEUTRAL

 

Assa Abloy

ASAZF

ASSAB SS

Alexander Virgo

 

Atlas Copco

ATLKF

ATCOA SS

Vlad Sergievskii

 

Morgan Advanced Materials

MCRUF

MGAM LN

George Featherstone, CFA

 

Schneider

SBGSF

SU FP

Alexander Virgo

 

Siemens Gamesa

GCTAF

SGRE SQ

Benjamin Heelan

 

Spectris

SEPJF

SXS LN

George Featherstone, CFA

UNDERPERFORM

 

Alfa Laval

ALFVF

ALFA SS

Uma Samlin

 

Alstom

AOMFF

ALO FP

Vlad Sergievskii

 

Bodycote PLC

BYPLF

BOY LN

George Featherstone, CFA

 

DUERR AG

DUERF

DUE GY

Alexander Virgo

 

Electrolux

ELUXY

ELUXY US

Uma Samlin

 

Electrolux

ELRXF

ELUXB SS

Uma Samlin

 

FLSmidth

FLIDF

FLS DC

Vlad Sergievskii

 

Jungheinrich Pref

JGHAF

JUN3 GY

George Featherstone, CFA

 

Kone OYJ

KNYJF

KNEBV FH

Alexander Virgo

 

Legrand

LGRVF

LR FP

Alexander Virgo

 

Prysmian

PRYMF

PRY IM

George Featherstone, CFA

 

Sandvik

SDVKF

SAND SS

Vlad Sergievskii

 

Sandvik

SDVKY

SDVKY US

Vlad Sergievskii

 

Schindler Group

SHLAF

SCHP SW

Alexander Virgo

 

SGL Group

SGLFF

SGL GY

Alexander Virgo

 

Smiths Group

SMGKF

SMIN LN

Vlad Sergievskii

 

Smiths Group

SMGZY

SMGZY US

Vlad Sergievskii

 

Stadler

SRAIF

SRAIL SW

Vlad Sergievskii

 

Wartsila OYJ

WRTBF

WRT1V FH

Vlad Sergievskii

 

Weir Group

WEIGF

WEIR LN

Vlad Sergievskii

RSTR

 

Neles Oyj

MXTOF

NELES FH

Alexander Virgo

RVW

 

Osram

OSAGF

OSR GR

Alexander Virgo

 

 

EMEA - Luxury Goods & General Retail Coverage Cluster

Investment rating

Company

BofA Ticker

Bloomberg symbol

Analyst

BUY

 

Dr. Martens PLC

DOCMF

DOCS LN

David Roux

 

Dufry

DFRYF

DUFN SW

Lorenzo Margiotta, CFA

 

Farfetch

FTCH

FTCH US

Geoffroy de Mendez

 

Hermes

HESAF

RMS FP

Ashley Wallace

 

JD Sports

JDDSF

JD/ LN

David Roux

 

LVMH

LVMHF

MC FP

Ashley Wallace

 

Moncler

MONRF

MONC IM

Geoffroy de Mendez

 

Mytheresa

MYTE

MYTE US

Geoffroy de Mendez

 

Next PLC

NXGPF

NXT LN

David Roux

 

Prada

PRDSF

1913 HK

Geoffroy de Mendez

 

PUMA

PMMAF

PUM GY

David Roux

 

Richemont

CFRHF

CFR SW

Ashley Wallace

 

Sanlorenzo

XWGHF

SL IM

Daria Nasledysheva

 

Shop Apotheke

SHPPF

SAE GY

Lorenzo Margiotta, CFA

 

SMCP

SMCSF

SMCP FP

David Roux

 

Swatch Group

SWGAF

UHR SW

Ashley Wallace

 

The Hut Group

THGPF

THG LN

Geoffroy de Mendez

 

Watches of Switzerland

WOSGF

WOSG LN

Daria Nasledysheva

 

WH Smith

WHTPF

SMWH LN

Lorenzo Margiotta, CFA

 

Zur Rose Group

ZRSEF

ROSE SW

Lorenzo Margiotta, CFA

NEUTRAL

 

B&M European Value Retail

BMRPF

BME LN

Lorenzo Margiotta, CFA

 

boohoo Group PLC

BHHOF

BOO LN

Geoffroy de Mendez

 

Brunello Cucinelli

BCUCF

BC IM

Daria Nasledysheva

 

Burberry

BBRYF

BRBY LN

Ashley Wallace

 

Ceconomy

MTAGF

CEC GY

Lorenzo Margiotta, CFA

 

CTS Eventim

CEVMF

EVD GY

Lorenzo Margiotta, CFA

 

De' Longhi S.p.A

DELHF

DLG IM

Lorenzo Margiotta, CFA

 

EssilorLuxottica

ESLOF

EL FP

Ashley Wallace

 

EssilorLuxottica

ESLOY

ESLOY US

Ashley Wallace

 

Fielmann AG

FLMNF

FIE GY

Ashley Wallace

 

Groupe SEB

SEBYF

SK FP

Lorenzo Margiotta, CFA

 

Hugo Boss

HUGPF

BOSS GY

Geoffroy de Mendez

 

Kering

PPRUF

KER FP

Ashley Wallace

 

Marks and Spencer

MAKSF

MKS LN

Lorenzo Margiotta, CFA

 

Marks and Spencer

MAKSY

MAKSY US

Lorenzo Margiotta, CFA

 

Pandora

XNPUF

PNDORA DC

Geoffroy de Mendez

UNDERPERFORM

 

Adidas AG-ADR

ADDYY

ADDYY US

David Roux

 

adidas Group

ADDDF

ADS GY

David Roux

 

ASOS

ASOMF

ASC LN

Geoffroy de Mendez

 

Associated British Foods plc

ASBFF

ABF LN

David Roux

 

Associated British Foods plc

ASBFY

ASBFY US

David Roux

 

Frasers

SDIPF

FRAS LN

David Roux

 

H&M

HMRZF

HMB SS

Ashley Wallace

 

Inditex

IDEXF

ITX SQ

Ashley Wallace

 

Kingfisher

KGFHF

KGF LN

Lorenzo Margiotta, CFA

 

Kingfisher

KGFHY

KGFHY US

Lorenzo Margiotta, CFA

 

Salvatore Ferragamo SpA

SFRGF

SFER IM

Daria Nasledysheva

 

Tods

TODGF

TOD IM

Daria Nasledysheva

 

Zalando

ZLDSF

ZAL GY

Geoffroy de Mendez

 

 

EMEA - Metals & Mining, Steel, Paper Coverage Cluster

Investment rating

Company

BofA Ticker

Bloomberg symbol

Analyst

BUY

 

Acerinox

ANIOF

ACX SQ

Patrick Mann, CFA

 

Anglo Pacific Group Plc

AGPIF

APF LN

Jason Fairclough

 

Antofagasta

ANFGF

ANTO LN

Jason Fairclough

 

Aperam

XASPF

APAM NA

Patrick Mann, CFA

 

ArcelorMittal

AMSYF

MT NA

Patrick Mann, CFA

 

ArcelorMittal

MT

MT US

Patrick Mann, CFA

 

Atalaya Mining Plc

XPGBF

ATYM LN

Jason Fairclough

 

Befesa

XTRFF

BFSA GY

Jason Fairclough

 

Centamin Plc

CELTF

CEY LN

Jason Fairclough

 

Centamin Plc

YCEE

CEE CN

Jason Fairclough

 

DS Smith plc

DITHF

SMDS LN

Joffrey Bellicha Meller

 

Eramet

ERMAF

ERA FP

Jason Fairclough

 

Fresnillo plc

FNLPF

FRES LN

Jason Fairclough

 

Gem Diamonds

GMDMF

GEMD LN

Jason Fairclough

 

Hochschild Mining plc

HCHDF

HOC LN

Jason Fairclough

 

Lucara Diamond Corporation

XDVAF

LUC SS

Jason Fairclough

 

Lucara Diamond Corporation

YLUC

LUC CN

Jason Fairclough

 

Norsk Hydro

NHYDY

NHYDY US

Jason Fairclough

 

Norsk Hydro

NHYKF

NHY NO

Jason Fairclough

 

Rio Tinto Plc

RIO

RIO US

Jason Fairclough

 

Rio Tinto Plc

RTPPF

RIO LN

Jason Fairclough

 

SCA

SVCBF

SCAB SS

Joffrey Bellicha Meller

 

SIG Combibloc Group

SCBGF

SIGN SW

Joffrey Bellicha Meller

 

Smurfit Kappa

SMFTF

SKG ID

Joffrey Bellicha Meller

 

Smurfit Kappa

XNKFF

SKG LN

Joffrey Bellicha Meller

 

SolGold plc

SLGGF

SOLG LN

Jason Fairclough

 

Thyssenkrupp

TYEKF

TKA GY

Jason Fairclough

 

Voestalpine

VLPNF

VOE AV

Patrick Mann, CFA

 

Yellow Cake Plc

YLLXF

YCA LN

Jason Fairclough

NEUTRAL

 

Anglo American

AAUKF

AAL LN

Jason Fairclough

 

Glencore

GLCNF

GLEN LN

Jason Fairclough

 

Glencore

XGLNF

GLN SJ

Jason Fairclough

 

Imerys

IMYSF

NK FP

Jason Fairclough

 

Mondi Plc

MONDF

MNDI LN

Joffrey Bellicha Meller

 

Mondi Plc

XDPMF

MNP SJ

Joffrey Bellicha Meller

 

Petra Diamonds

XPDIF

PDL LN

Jason Fairclough

UNDERPERFORM

 

Aurubis

AIAGF

NDA GY

Jason Fairclough

 

Boliden

BOLIF

BOL SS

Jason Fairclough

 

Ferrexpo plc

FEEXF

FXPO LN

Jason Fairclough

 

Outokumpu

OUTFF

OUT1V FH

Patrick Mann, CFA

 

Salzgitter

SZGPF

SZG GY

Patrick Mann, CFA

 

SSAB

SSAAF

SSABA SS

Patrick Mann, CFA

 

Stora Enso

SEOJF

STERV FH

Joffrey Bellicha Meller

 

Stora Enso

SEOAY

SEOAY US

Joffrey Bellicha Meller

 

UPM-Kymmene

UPMKF

UPM FH

Joffrey Bellicha Meller

 

 

EMEA - Oil & Gas Coverage Cluster

Investment rating

Company

BofA Ticker

Bloomberg symbol

Analyst

BUY

 

Aker Carbon Capture

AKCCF

ACC NO

James Winchester

 

Aker Solutions

AKRTF

AKSO NO

James Winchester

 

Capricorn Energy

CRNZF

CNE LN

Matthew Smith

 

CGG

CGPVF

CGG FP

Vlad Sergievskii

 

Energean

EERGF

ENOG LN

Matthew Smith

 

Energean

XMQFF

ENOG IT

Matthew Smith

 

EnQuest

ENQUF

ENQ LN

Matthew Smith

 

EnQuest

XESQF

ENQ SS

Matthew Smith

 

Equinor ASA

STOHF

EQNR NO

Mehdi Ennebati

 

Equinor ASA

EQNR

EQNR US

Mehdi Ennebati

 

Galp Energia

GLPEF

GALP PL

Mehdi Ennebati

 

Harbour Energy

PMOIF

HBR LN