Newsquawk Daily European Equity Opening News - 22nd February 2024

22nd February 2024

ASIA

APAC stocks were mostly positive amid tailwinds from the tech uplift in US futures following NVIDIA earnings. ASX 200 lagged as participants continued to digest an influx of earnings after Australia's Flash Manufacturing PMI returned to contraction territory. Nikkei 225 outperformed amid tech strength and eventually printed fresh intraday record highs above 39,000. KOSPI was marginally higher after the BoK kept rates unchanged and signalled an unlikelihood of a cut soon. Hang Seng and Shanghai Comp. were both firmer albeit with price action in Hong Kong choppy amid US-China chip-related frictions, while the mainland remained afloat after the latest stability efforts by China.

Lenovo (992 HK) - Q3 (USD) net 337mln (prev. 437mln Y/Y), rev. 15.7bln (prev. 15.3bln). (Newswires)

EUROPEAN CLOSES

CLOSES: DAX: +0.29% at 17,118.12, FTSE 100: -0.73% at 7,662.51, CAC 40: +0.22% at 7,812.09, Euro Stoxx 50: +0.27% at 4,773.05, IBEX 35: +0.69% at 10,107.20, FTSE MIB: +1.00% at 32,018.40, SMI: -0.33% at 11,419.30.

SECTORS: Energy 0.62%, Consumer Disc 0.39%, Industrials 0.20%, Utilities 0.13%, Consumer Stpl -0.06%, Materials -0.17%, IT -0.31%, Telecoms -0.35%, Financials -0.70%, Healthcare -0.77%

FTSE 100

Ex-Dividends - Endeavour Mining (EDV LN), GSK (GSK LN), Land Securities (LAND LN), Unilever (ULVR LN), AstraZeneca (AZN LN) will trade without entitlement to their latest dividend payout. (Newswires)

Housing/Banking Names - UK Chancellor Hunt is reportedly working on plans for a 99% mortgage scheme, via FT citing officials. (FT)

LSE – London Stock Exchange suffered an outage.

OTHER UK COMPANIES

Carnival (CCL LN) - * Royal Caribbean (RCL) lifted FY2024 adj. EPS outlook to between USD 9.90-10.10 (exp. 9.77) vs a prior view of between 9.50-9.70. Said it continues to be encouraged by demand and the pricing environment for 2024.

Superdry (SDRY LN) – Asahi Group is ready to find more acquisition targets as it aims to expand the business in the US, according to Bloomberg. (Bloomberg)

BROKER MOVES

Computacenter (CCC LN) initiated with Buy at Panmure Gordon

DAX

Heidelberg Materials (HEI GY) - FY23 (EUR): Op. EBIT 4.26bln (exp. 4.25bln), Revenue 21.2bln (exp. 21.4bln). Guides initial FY24 Rev "growth" Y/Y. Decides on EUR 1.2bln buyback programme; expected to be completed by 2026-end at the latest. (Newswires)

Mercedes-Benz (MBG GY) - Q4 (EUR): Revenue 40.26bln (exp. 38.61bln). Sees 2024 Cars Adj. Return on Sales between 10-12% (exp. 11.3%); Free cash flow of the industrial business seen slightly above the prior-year level. COMMENTARY: Group EBIT is expected to be slightly below the previous year's level resulting in divisional guidances. Mercedes-Benz Cars will seek to defend and hold pricing at 2023 levels. Some material tailwinds on raw material costs are seen and further headwinds on supply-chain related costs are expected. Co. sees unit sales of Mercedes-Benz Cars at the prior-year level, even as current supply bottlenecks are easing. However, some topics remain and will impact sales in 2024. Total Mercedes-Benz Vans sales are expected to soften in H2 2024 and be slightly lower in 2024 with a strong first quarter. Co. yesterday announced a share buyback programme of up to EUR 3bln. (Mercedes-Benz/Newswires) Index Weightings: DAX 40 (4.01%), Euro Stoxx 50 (1.6%), Stoxx 600 (0.5%) Shares seen opening +3.1%

MTU Aero Engines (MTX GY) - Guides initial FY24 Revenue EUR 7.3-7.7bln, adj. EBIT margin >12%, FCF "in the more than three-digit million euro range". Proposes dividend of EUR 2/shr for the 2023 financial year and forecasts growth of all market segments. (Newswires) Shares seen opening -3.4%

OTHER GERMAN COMPANIES

Delivery Hero (DHER GY) - Terminates negotiations of a potential sale of its FoodPanda business in selected markets in Southeast Asia. (Newswires) Shares seen opening -10%

Gerresheimer (GXI GY) - FY23 (EUR): Adj. EBITDA 119.3mln (exp. 119mln), Revenue 545.2mln (exp. 548mln). Guides initial FY24 adj. EPS 8-12%, Organic Revenue 5-10% Y/Y. (Newswires)

Knorr-Bremse (KBX GY) - FY23 (EUR): EBITDA 1.22bln (prev. 1.05bln Y/Y), Revenue 7.93bln (prev. 7.15bln Y/Y). Guides initial FY24 Revenue 7.7-7.8bln, Op. EBITDA margin 11.5-12.5%. (Newswires)

BROKER MOVES

CAC

AXA (CS FP) - FY23 (EUR): Revenue 102.7bln (exp. 105.5bln), Net 7.19bln (exp. 7.45bln). Co. announces a share buyback of up to EUR 1.6bln. Co. increased main financial targets for 2024-2026. Targeting a total payout ratio of 75%, comprising a 60% dividend payout ratio and an additional 15% from annual share buy-backs. Dividend +16% Y/Y to EUR 1.98/shr. Co. announced a new strategic plan dubbed “Unlock the Future”. (AXA) Index Weightings: CAC 40 (3.3%), Euro Stoxx 50 (1.8%), Stoxx 600 (0.6%)

Engie (ENGI FP) – FY23 (EUR): Recurring Net 5.4bln (exp. 5.4bln), EBITDA 15bln (exp. 15bln), Revenue 86.2bln (exp. 94.3bln). Guides initial FY24 recurring net 4.2-4.8bln (exp. 4.2bln). (Newswires)

Danone (BN FP) - FY23 (EUR): Recurring EPS 3.54 (exp. 3.53, prev. 3.43 Y/Y), Recurring Op. 3.48bln (prev. 3.38bln Y/Y), Revenue 27.6bln (exp. 27.63bln, prev. 27.7bln). Q4 LFL Sales +5.1%. Guides initial FY24 LFL Revenue +3-5%. (Newswires) Index Weightings: CAC 40 (2.2%), Euro Stoxx 50 (1.2%), Stoxx 600 (0.4%)

Total Energies (TTE FP) - The Port Arthur, Texas refinery (185k BPD) is operating at minimal production, according to Reuters sources. (Reuters)

OTHER FRENCH COMPANIES

Accor (AC FP) - FY (EUR): Revenue 5.05bln (exp. 5.1bln), EBITDA 1.00bln (exp. 0.99bln), Net 633mln (exp. 489mln). Propose a 1.18/shr dividend (exp. 0.96/shr). (Newswires)

Bureau Veritas (BVI FP) - Acquires electrical and electronic consumer products supplier ANCE in Mexico, no terms disclosed. (Newswires)

Sopra Steria (SOP FP) - Sopra Steria (SOP FP) – FY23 (EUR): Net 184mln (exp. 392mln), Op 548mln (prev. 453mln Y/Y), Revenue 5.81bln (exp. 6.31bln). Guides FY24 Organic Revenue +2-4%. Axway enters a deal discussion to acquire a good portion of Sopra Banking Software's operations. To sell 3.6mln of Axway shares or EUR 95.9mln to Sopra GMT. (Businesswire)

BROKER MOVES

Schneider Electric (SU FP) downgraded to Hold from Buy at HSBC

Soitec (SOI FP) initiated with Buy at HSBC

STMicroelectronics (STM FP) initiated with Buy at HSBC

PAN EUROPE

Aalberts (AALB NA) – FY23 (EUR): Adj. EPS 3.38 (prev. 3.37 Y/Y), Revenue 3.32bln (prev. 3.32bln Y/Y). (Newswires)

Arcadis (ARCAD NA) - Q4 (EUR): EBITA 107mln (prev. 86mln Y/Y), Net Revenue 941mln (prev. 861mln Y/Y). (Newswires)

AMG Critical Materials N.V. (AMG NA) - Says its analysis of the long-term supply and demand trends in lithium gives them confidence that the present low prices are unsustainable. (Newswires)

BE Semiconductor (BESI NA) - Q4 (EUR): Net 54.9mln (prev. 35mln Y/Y), Revenue 159.6mln (prev. 123mln Y/Y). Guides Q1 Revenue -5 to -15% Q/Q. (Newswires)

Repsol (REP SM) – Q4 (EUR): EBITDA 2.06bln (exp. 2.33bln), adj. Net 1.2bln (exp. 0.94bln). To implement a share buyback programme for up to 35mln shares, which will remain in force until 31st July at the latest. As part of a share capital reduction of 3.29% of its share capital, after this share capital will be set at EUR 1.18bln with a par value of EUR 1/shr. (Newswires)

Stellantis (STLAM IM/STALP FP) - To launch production of medium-sized EVs in 2025 at the Luton, UK facility. (Newswires)

Telefonica (TEF SM) - Q4 (EUR): Revenue 10.2bln (exp. 10.1bln). OIBDA 1.80bln (exp. 1.99bln); FCF -25.3% Y/Y; Telefonica also confirms its shareholder remuneration for 2023. *Index Weightings: IBEX 35 (3.9%), Stoxx 600 (0.2%)*

Tech Names - NVIDIA Corp (NVDA) - Q4 2024 (USD): Adj. EPS 5.16 (exp. 4.64), Revenue 22.1bln (exp. 20.62bln). Q1 25 revenue view 24bln plus or minus 2% (exp. 21.9bln). (Newswires) NVDA shares +9% in after-hours

BROKER MOVES

ASML (ASML NA) initiated with Buy at HSBC

SMI

Nestle (NESN SW) - FY23 (CHF): Revenue 92bln (exp. 94.04bln). Organic Revenue +7.2% (exp. +7.4%). Dividend 3 (exp. 3.08). Real Internal Growth -0.3% (exp. +0.08%). Sees 2024 organic revenue around +4% (exp. +4.91%). OUTLOOK 2024 outlook: "We expect organic sales growth around 4% and a moderate increase in the underlying trading operating profit margin. Underlying earnings per share in constant currency is expected to increase between 6% and 10%." 2025 mid-term targets fully confirmed: mid-single-digit organic sales growth and an underlying trading operating profit margin range of 17.5% to 18.5% by 2025. Underlying earnings per share in constant currency to increase between 6% and 10%. COMMENTARY Growth was broad-based across most geographies and categories. Distribution costs as a percentage of sales decreased. (Nestle) Index Weighting: SMI (17.5% - largest), Stoxx 600 (2.8% - second largest)

Zurich Insurance (ZURN SW) - FY23 (USD): Net 4.35bln (exp. 5.1bln, prev. 3.96bln Y/Y), Business Op. 7.38bln (prev. 6.12bln Y/Y), ROE 13.1% (prev. 15%). Guides initial FY24 P&C Commercial Insurance margin "growth in mid-single digits". (Newswires)

OTHER SWISS COMPANIES

Cembra Money Bank (CMBN SW) - FY23 (CHF): Net 158mln (prev. 169.3mln Y/Y), Revenue 515.7mln (prev. 508.9mln Y/Y). (Newswires)

BROKER MOVES

SCANDINAVIA

ISS (ISS DC) - FY23 (DKK): Adj. EBIT 3.3bln (exp. 3.4bln), Revenue 78.78bln (exp. 79.1bln). Initiates DKK 1bln share buyback programme. (Newswires)

BROKER MOVES

Saab (SAABB SS) downgraded to Neutral from Buy at Citi

SOBI (SOBI SS) downgraded to Hold from Buy at Deutsche Bank

US

CLOSES: SPX +0.13% at 4,982, NDX -0.38% at 17,479, DJI +0.13% at 38,612, RUT -0.47% 1,995.

SECTORS: Energy +1.86%, Utilities +1.36%, Real Estate +0.72%, Consumer Discretionary +0.72%, Materials +0.57%, Industrials +0.42%, Financials +0.31%, Consumer Staples +0.29%, Health +0.26%, Communication Services +0.19%, Technology -0.76%.

Intel (INTC) - Launches world’s first systems foundry designed for the AI era; Microsoft (MSFT) will use Intel to manufacture home-grown processors and MSFT will produce chips using Intel's 18a technology. Plans to begin producing 1.4 nanometre chips in the coming years as it ramps up its foundry business, according to Nikkei citing CEO Gelsinger at Intel foundry event on Wednesday. (Newswires)

Rivian Automotive Inc (RIVN) - Q4 2023 (USD): Adj. EPS -1.36 (exp. -1.32), Revenue 1.32bln (exp. 1.26bln). To cut 10% of salaries staff, citing economic uncertainty. (Newswires) Shares fell 15.3% after hours

NVIDIA Corp (NVDA) - Q4 2024 (USD): Adj. EPS 5.16 (exp. 4.64), Revenue 22.1bln (exp. 20.62bln). Q1 25 revenue view 24bln plus or minus 2% (exp. 21.9bln). Revenue breakdown (USD). Data Centre revenue 18.4bln (exp. 17.21bln). Gaming revenue +58% y/y to 2.9bln (exp. 2.72bln). Professional Visualization revenue 463mln (exp. 435.5mln). Automotive revenue -4.4% Y/Y to 281mln (exp. 272.1mln). Other metrics ADJ gross margin 76.7% (exp. 75.4%). R&D expenses +26% Y/Y to USD 2.47bln (exp. 2.43bln). ADJ operating expenses +25% Y/Y to USD 2.21bln (exp. 2.23bln). ADJ operating income USD 14.75bln (exp. 13.14bln). Free cash flow USD 11.22bln (exp. 10.82bln). Commentary Generative AI has "hit the tipping point". Data Center sales to China declined significantly in Q4 due to US government licensing requirements. Says has gotten requests for information from antitrust regulators in France, EU, UK and China over its sales of GPUs and efforts to allocate supply, while it expects to receive additional requests for information. CEO says demand far exceeds supply for next-generation products and cannot keep up with demand as we ramp. Says China represented mid-single-digit percentage of data centre revenue in Q4 due to USG licensing requirements and sees it to be in a similar range in Q1 (Newswires) Shares +9% in after-hours

22 Feb 2024 - 06:59- Research Sheet- Source: Newsquawk

EURNVDA.USSopra Group SAIntel CorpNVIDIA CorpDAX 40 IndexNVDAFTSE 100 IndexUSDNestle SAAXA SAAI FPMSFTTelefonica SAAMG.NAASML.NASOBI.SSTEF.SMSAABB.SSMSFT.USISS.DCSTM.FPAALB.NAARCAD.NAREP.SMBESI.NAINTC.US992.HKGSK.LNLAND.LNULVR.LNAZN.LNCCL.LNRCL.USCCC.LNHEI.GYMTX.GYGXI.GYCS.FPBN.FPAC.FPBVI.FPSOP.FPSU.FPSOI.FPUnited StatesUnited KingdomFranceMicrosoft CorpUSG CorpENGI.FPNESNPurchasing Manager IndexITEndeavour Mining CorpEDVGSKLand Securities Group PLCLANDUnilever PLCULVRAstraZeneca PLCLSELondon Stock Exchange Group PlcCCLRCLComputacenter PLCCCC SAHEIMBGMTU Aero Engines AGMTXGermanyGerresheimer AGCSEngieENGIDanone SABNTTEAccor SABureau Veritas SASoftwareSUSOITECBESIRepsol SASTLAMASMLZurich Insurance Group AGZURNCInsuranceCembra Money Bank AGDeutsche Bank AGS&P 500 IndexNASDAQ 100 IndexStaples IncINTCCHFChinaEU SessionAsian SessionHighlightedResearch SheetDataAZNHong KongAustraliaDKKAsiaMexicoEurope

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