It is a general opinion on the part of a good part of financial analysts that there are enough reasons for the selective index of Spanish equities, the Ibex 35, to be above 9.000 points. In this sense, they suggest that the worst scenarios in the stock market are already discounted. Something very complex to specify when the approval of the general budgets by Italy is pending. The main factor of dislodging the evolution of the shares of the most important companies in the European financial market.
Another aspect that should be taken into account is that listed companies will show lower profits in the next business results than until now. In this sense, one of the companies most followed by small and medium investors is without a doubt Técnicas Reunidas. Has been one of the most punished in recent years with a depreciation in its value more than relevant. This is one of the reasons why its appreciation potential may be higher from now on.
Well, despite its poor form, it has starred in a more than important rebound in the national equity markets. Técnicas Reunidas has posted daily increases of over 3% last week, after adjusting its prices down very severely. But the good news for investors who want to opt for this stock market proposal is that their positions have been reinforced by some of the most relevant financial analysts in the stock market. As in the specific cases of Morgan Stanley and JP Morgan who have varied their perspectives towards the engineering company.
Técnicas Reunidas at 22 euros
The shares of this Ibex 35 company are currently at a crucial moment in their price. Because during the past week it has finally managed to recover the level of 22 euros per share. This would be a first step to achieve higher heights, at least for the next year or even if the traditional one is produced bull rally of the Christmas holidays. It cannot be forgotten that not many years have passed since its valuation was at levels above 30 euros. Being, in any case, one of the preferred values by the different financial analysts.
This company, however, started a notable flight of buyers and that has led to the fact that in a very short space of time almost a third has been left of your valuation. In this general scenario, it is very important to specify that if the increases of the last days constitute a one-off rebound and nothing else or, on the contrary, it is an important change in trend. In any of the cases, it will be necessary to wait a few days to be almost absolute certainty about what is happening with their titles at the moment.
Target prices higher than their value
The good news for small and medium investors is based on the fact that the aforementioned banks, while they have cut the company's target price, it is still above its actual valuation these days. By targeting a target price that oscillates between 25 and 30 euros per share. This means that Técnicas Reunidas shares have interesting upside potential. Even with the downward revision they have received from Morgan Stanley and JP Morgan. To the point that some of the most aggressive investors in the market have already taken positions in the value to monetize their personal capital.
To a large extent, the increases in recent days have been caused by the rise in the price of oil. Although this in the last session has fallen by almost 3% as a result of the new settings in the law of supply and demand in this important financial asset. Because anything that is an increase in the price of crude oil will be very beneficial to the interests of the company that is listed in the selective index of the national stock market. And everything indicates that it works in their favor, depending on the bets of the financial analysts with the greatest predilection in the financial markets.
Linked to the price of crude oil
The falls of the last days have been derived after the Organization of Petroleum Exporting Countries (OPEC) has confirmed that in the last month crude oil production has increased. Not surprisingly, Técnicas Reunidas' dependence on this notable financial asset is more than relevant, as has been seen in recent years. Beyond other technical considerations and maybe also from a fundamental point of view. Because it has gone from being one of the great heavyweights of Spanish equities to becoming one of the disappointments of this year that is about to end.
In this sense, it is at the expense of the volatility of this financial market and that has led to it currently having an important medium and long-term resistance which are located at levels of 23 euros for each share. Provided that a certain sufficiency is exceeded in environments very close to 21,72. This in practice means that it moves under very narrow movements with regard to the appreciation of its prices. For this reason, it is very complex to predict whether it is more favorable to enter or exit positions at this value of the Ibex 35.
Strategies right now
In any case, there is no doubt that Técnicas Reunidas is one of the most complex securities to operate in all the terms provided by the calendar: short, medium and long. Among other reasons why supports and resistances they are at points not far from each other. To the point that it is very easy to make the odd mistake in the strategies that you can develop from now on. With variations between its maximum and minimum prices that are very high and in any case higher than those provided by other values of the national continuous market.
On the other hand, the latest quarterly results of the company induce that caution is the common denominator of most of your investment strategies. Not surprisingly, they tend to be very divergent from one quarter to another, something that does not happen in other stock market proposals presented by Spanish equities. While on the contrary, the possibilities of being wrong are manifestly verifiable, as can attest to a large part of the small and medium investors. In two of the biggest technical incidents presented by one of the engineering companies in the Spanish economy.
Latest business results
With respect to the latest public data of this company, it should be noted that one of the most relevant factors is the one that indicates that this company presents a significant drop in profits of just over 90% in the first nine months of the year, in relation to with the same period last year. One of the triggers for these disappointing results is due to the currency effect, It is especially due to the strong depreciation of the Turkish lira and that has affected that these intermediation margins have not convinced the financial markets.
On the other hand, no less disappointing has been the gross operating profit (Ebitda) and that in this period has stood at 43,5 million. This, in practice, means that it has dropped about 60% compared to the same period in 2017. While on the contrary, its turnover has reached 3.256 million, 16% less than in the previous period analyzed. In any of the cases, these are data that have fallen very badly in the equity markets with the consequent drops in value. To the point of being at one of the lowest levels in recent years.
Quality in value
In any case, there is one aspect in which most analysts agree and that is that this company has value with respect to the medium and long term. In this sense, the cuts can be used to take positions in the face of these deadlines. With a very appreciable advantage and that is that operations can be done at a much more competitive price than before. Beyond other technical considerations and although now it is not in the best of its quotation levels. Because you can't forget that it was one of the stock market bets preferred by financial intermediaries.
From this perspective, Técnicas Reunidas should at least serve to keep it on the radar of operations as of next year. Because at any time you can restart the upward movements before the appearance of new contracts in civil engineering during the next few years. So your target price could be raised from your current positions. Although it has some powerful supports ahead of it that can slow down its escalation to the upside.