Grifols
Note: This is a daily stock update and the information stands true as of 08/11/24, 09:00 CET.
Company Update:
Still a buy in my view. We are convinced that the group will not need any capital increase as the deleveraging goes as planned and the business remains fundamentally solid with strong short term momentum. Valuation remains extremely attractive with PE24 of 14.2 down to 8.4x for PE26. Even without the prospect of a takeover bid by the family and Brookfield Asset management, I would buy the company on its own merits.
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Company Update:
Sales came in at €1.8bn, up c.12%, in line with expectations.
‘Adjusted’ EBITDA jumped c.25% (in actual currency terms) to €462m, aided by operating leverage and lower cost-per-liter. This was a 1% beat to consensus.
Net debt-to-LTM-EBITDA, declined to 6.1x (vs. 6.5x at end-Q2 24). This is key as some are concerned about the unsustainability of the balance sheet.
FY Guidance maintained with sales to grow north of 7% and Adjusted EBITDA expected above €1.8bn.
Post Q3 release, Grifols’ US-listed ADRs were up c.5%
Expert Opinion:Still a buy in my view. We are convinced that the group will not need any capital increase as the deleveraging goes as planned and the business remains fundamentally solid with strong short term momentum. Valuation remains extremely attractive with PE24 of 14.2 down to 8.4x for PE26. Even without the prospect of a takeover bid by the family and Brookfield Asset management, I would buy the company on its own merits.
For daily updates, subscribe to our newsletter and for detailed daily updates, reach out to us at sales@alphavalue.eu
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Alphavalue Morning Market Tip
Weak Q2 results and FY guidance (marginally) cut but a fat 9.4 % div yield.
