2023-09-15 10:40:02
September 14, 2023 Today at 11:47
The Colruyt meeting, which takes place in two weeks, might provide answers to two questions. Will the annual forecasts be raised and what will Colruyt do with the funds from the sale of Parkwind? Here are some ideas.
Next September 27 will be held the general meeting of shareholders of Colruyt
. An event always closely followed by investors to the extent that it is an opportunity for the brand’s managers to provide details on forecasts for the current financial year.
This year, the general assembly should prove even more important, believes Fernand de Boer, Degroof Petercam. With two questions at stake: Will Colruyt raise its “conservative” guidance and what will happen with the funds obtained from the sale of Parkwind?
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Degoof Petercam therefore raised its estimates for ebit, going from 326 million euros (the consensus is 312 million) to 344 million.
Forecasts noted?
The forecasts first. Remember that on June 13, the distributor indicated that it anticipated that operating profit and net profit would increase “significantly” during the 2023/24 financial year. Without quantifying what he meant by “significantly”.
Pour l’analyste de Degroof Petercam, that means around 20% and therefore an ebit of 300 million euros. But he believes that this is far too little. For three reasons. Inflation trends, the previous financial year, which was weighed down by write-downs, and the second half results, which showed a significant recovery in ebit. He therefore raised his estimates for the latter, going from 326 million euros (the consensus is 312 million) to 344 million.
Total or partial offer
The sale of Parkwind then. According to Colruyt, this will bring in between 600 and 700 million euros for its 59.94% stake. Using the resources available within the group, we reach a range between 600 and 900 million. Could this amount return to shareholders in the form of a dividend or share buyback?
“An offer at 45 euros per share would require an investment of 2 billion euros.”
Fernand de Boer
Analyst chez Degroof Petercam
Distribution of a dividend will further enrich Honeycomb (holding of the Colruyt family), which will have already received 500 million euros from the sale of Parkwind, objects the analyst, who adds that the 35% withholding tax Striking stock coupons is not an ideal solution for private investors either. As for a share buyback program, it will not be easy to implement due to the amount available and the size of the float, explains Fernand de Boer.
“For this reason, we do not exclude that Colruyt/Korys will take advantage of this opportunity to make a partial or total offer,” says the analyst. An offer at 45 euros per share would require an investment of 2 billion euros.”
Whatever decision Colruyt takes in this matter, it is clear that this will create upside potential for the stock, concludes Fernand de Boer. He therefore reiterates his purchasing advice and increases its price target by 5 eurosto increase it to 45 euros.
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