One of the great positive surprises this year with regard to the securities that make up the selective index of Spanish equities is undoubtedly the Teleco Cellnex. Not only are they showing a flawless uptrend. If not, on the other hand, it has one of the most important revaluation potentials by investment banks. To the extent that it is one of the securities chosen to make up the investment model portfolio for the next few years.
In addition, you cannot forget that it is one of the stock bets that have appreciated the most this year, with double-digit growth in a year that is not being easy for small and medium investors. Although yes for those who have opened positions in this short-lived security in the equity markets. But that are doubtless has been opened a gap between the preferences of a large part of financial agents. Being a value that can do better on the stock market than the rest.
While on the other hand, it counts with very positive expectations in their business lines and that therefore it can be more receptive to include it in the radar to all the terms of permanence: short, medium and long. Not surprisingly, it generates less risk in the positions taken from now on due to the excellent technical aspect it presents at this time of year. Beyond other considerations of a technical nature and perhaps also from the point of view of its fundamentals. Either way, it's a value to keep in mind from now on.
Cellnex chosen by Goldman Sachs
This stock market value is receiving very good news from international investment banks. And in this sense, it highlights that Goldman sachs has chosen four Spanish stocks from its list of favorite European stocks for the next few months. These are Banco Santander, Ferrovial, Aedas Homes and precisely Cellnex. All of them have become included in the select 'conviction list' of the US investment bank. This is news that has encouraged the listed company to continue with its upward climb and in a very convincing way for investors.
The international investment bank, Goldman Sachs, grants upside potential of + 50%. In other words, a price of almost double its current prices in the equity markets. Which is saying a lot and good about this proposal to make profitable savings from now on. To the point that Cellnex is considered another of Goldman's favorites in the Spanish market. For any type of investor profile, from the most aggressive to the moderate or conservative. Because its behavior in the financial markets from now on may be much better than in the other securities.
Well positioned in the sector
Cellnex Telecom is a Spanish company of services and infrastructures of wireless telecommunications which has more than 27.000 locations throughout Europe. It also develops solutions in the field of “smart cities” projects, which optimize services for the citizen, through networks and services that facilitate municipal management. In this area, Cellnex Telecom is deploying an intelligent communications network that allows the connection between objects and, therefore, the development of a solid ecosystem for the Internet of Things.
While on the other hand, the company is listed on the continuous market of the Spanish stock market and is part of the selective Ibex 35 and EuroStoxx 600 and the MSCI Europe index. It is also part of the sustainability indices FTSE4GOOD, CDP (Carbon Disclosure Project), Sustainalytics and “Standard Ethics”. Cellnex's benchmark shareholders include ConnecT - whose shareholders are Edizione (60%), Adia (20%) and GIC (20%) - with a 29,9% stake in the share capital, as well as Threadneedle Asset Management, CriteriaCaixa and Blackrock, with minority stakes.
With moderate dividend distribution
Despite its short life in the equity markets, it is already one of the securities that distributes dividends among its shareholders. Although its profitability is not one of the most competitive within the selective index of the national stock market. With a fixed and guaranteed interest every year around 3%. Below the Ibex 35 average, although it is foreseeable that it could increase it in the coming years, at least to bring it to margins that are between 4% and 5%. In any case, it is another of the alternatives to form a fixed income portfolio within the variable. Whatever happens in the financial markets and that is to the liking of small and medium investors due to the stability it offers in the conformation of their prices.
On the other hand, it can be constituted in a shelter value to take positions at times of greatest instability in equity markets. As has happened in recent months where their buying pressure has been imposed with great clarity on the seller. With a notable increase in trading volume in all trading sessions. Which shows the growing interest on the part of small and medium investors. To the point that this is one of his most relevant preferences in the current year.
Buy recommendation
Despite the increases in recent months, the recommendation from financial agents and brokers is very clear: buy above all else. You have not yet reached your target price and you have a lot to say in setting your prices. Although it is normal for corrections of a certain depth to occur in its valuation for conform to the law of supply and demand of investors. Right now it can become a business opportunity if your desire is to make the savings profitable, at least in the medium and long term. With logical prudence in this class of operations in the equity markets.
While on the other hand, we cannot forget that Cellnex is one of the Emerging stocks on the Ibex 35. To the point that it has surprised a good part of the small and medium investors, where some were even unaware of its existence because it has been one of the last stock values to land in the sector. On the other hand, its monitoring is increasingly relevant by financial analysts and this factor is helping to make it better known among financial market agents. In a sector, such as telecommunications, in which only Telefónica is present.
Either way, it should be a proposal to take into consideration in the coming months with the aim of improving the balance of our savings account. With less risk than in other securities, at least at the moment. A fact that gives enough confidence to open positions from now on, which is ultimately what it is all about.
Convertible bond issuance
Cellnex Telecom has set the conditions for a new Issuance of senior convertible and unsecured bonds of the company. The placement has reached 850 million euros. The shares underlying the bonds equal to 5,0% of the company's capital. The initial conversion price of the bonds, which is subject to the usual adjustments, has been set at 57,1756 euros, which is equivalent to a premium of 70% over the volume-weighted average price of the share between the opening and the market close today. As a consequence of the agreed redemption price (108,57%), the effective conversion price will be 62,1 euros.
This issue is added to the first issue of convertible bonds carried out by the company, since its IPO in 2015, for a total of 800 million euros, and which materialized in two tranches: an initial placement for an amount of 600 million euros in January 2018; followed by an additional placement for 200 million in January 2019 (fungible with that of January 2018). In a sector, such as telecommunications, in which only Telefónica is present.
In line with the placement of this new Issue, José Manuel Aisa, Cellnex CFO and M&A Director, has highlighted "the excellent reception of the market to this new issue of convertible bonds. A fact that adds to the excellent response of our shareholders and the market to the recent capital increase of 1.200 million euros carried out last March. In this way, we take advantage of the favorable conditions offered by the market to reinforce the structure of our balance sheet, the liquidity of the company and the conditions of our debt in terms of cost and average life, given the important portfolio of projects identified (pipeline) for Cellnex purchase operations ”.