February 27, 2021

The values ​​that are left out of the Ibex 35 rally in February




The Spanish stock market started February with a perfect week in the Ibex 35 in which the selective chained five consecutive sessions in green. The bullish rally stopped this Tuesday with a fall of 1.44% which was followed by another three days of losses. Despite this, the indicator adds more than 3% when the first half of the month is fulfilled and manages to stay above 8,000 points, a level similar to that of the beginning of the year.

There is, however, a small group of stocks that are not participating in the good start of the Ibex. “When there is a rally, it is assumed that it is due to better economic expectations, what rebounds the most is what has been harmed the most,” explains Álvaro Arístegui, Income 4 analyst. Cyclical values ​​such as banks or those linked to tourism are the ones that more rebound in these cases, while the “defensive” tend to lag further behind.

It stays out …

The performance of the pharmaceutical companies in these two weeks reflects this. With the exception of Pharmamar, which shoots up 11% driven by the success of some of its treatments against Covid-19, other securities in the sector are not participating in the Ibex rally. This is the case of Almirall, which dropped 4% in February. The company presents its accounts for the past year on the 22nd and the market is focused on the recovery after the effect of the first lockdown in its dermatological division. In the first nine months, Almirall reduced its profit by 41% to 57 million euros. “When your sales force has to stay at home, even patients cannot go to the doctors for new drugs, your business suffers, but we hope that the results will improve”, points out Arístegui.

Another listed company in the sector, Grifols, lost more than 6% in the first half of February . The Catalan pharmaceutical company depends on blood donations in the United States for blood plasma, one of its main products, but the lower reserves due to the confinements are weighing down the company’s production chain. «Now I would be selling what was six or nine months ago, there is a shortage of raw materials, of plasma, to respond to the growth in demand. The market knows it and is penalizing it, “says the Renta 4 analyst.

The reduction in margins due to the weaker dollar and the arrival of new products related to competing plasma treatments are other factors that have caused Grifols to lag slightly behind the Ibex. Nevertheless, There are reasons for optimism, such as the arrival of new drugs that could be effective against the coronavirus and advances in the drug for Alzheimer’s Amber. “Just as it is now discounting the worst, in a couple of months, when these results are published and the market begins to anticipate the positive, the value will recover strongly”, predicts Arístegui.

In this sense, the consensus of Bloomberg analysts raises Grifols’ target price above 31 euros compared to the current 22 euros. Outside the pharmaceutical sector, Cellnex is another of the listed companies that is not following in the wake of the Ibex 35.

Cellnex, in correction

The operator’s shares are left 5% in February weighed down by the announcement at the end of last month of a capital increase of 7,000 million euros to finance the purchase of the 10,500 towers of Hivory in France, one of the last big moves of the company.

“What it is doing is a correction, it is at a support level,” explains Susana Felpeto, deputy director of equities at ATL Capital. Last year Cellnex performed well on the stock market by revaluing 37% to close above 51 euros, but the bad start to the year, in which it accumulated a 7% drop, left its price at just over 45 euros , your key level.

“If it falls below that level, it would lose the long-term upward trend that it brings, it could correct a little more,” Felpeto details. If, on the contrary, Cellnex managed to stay above its support, it could head towards a new goal at 55 euros, close to its all-time highs reached at the beginning of last November. According to the Bloomberg panel of experts, the commitment to Cellnex is clear, with 19 purchase recommendations, 76% of the total valuations. The company’s 12-month target price would also rise above its best mark to € 64 per share.

Naturgy’s opa

Naturgy announced at the end of January a takeover bid (takeover) of the Australian fund IFM for control of 22.69% of its shareholding. Despite the fact that the operation continues at the expense of the Government’s authorization, it had a spectacular reception in the market: its shares soared 15% to above 22 euros, its highest level since the beginning of the pandemic.

Since then, however, it has not been able to complete this trend and in the first two weeks of February it lost around 1.50%, remaining out of the rally of the Spanish stock market. “It is not that he has done it wrong, but that he is draining the strong momentum he had at the end of January”, explains Susana Felpeto. «It has not lost the bullish average. The company, regardless of the Government, has the capacity to continue improving and the levels of 22-23 euros are neither exaggerated nor excessive, ”says the ATL Capital analyst. Other listed companies, meanwhile, have lost prominence at the start of February.

“These are stocks that had performed well or reasonably well last year”, explains Felpeto. This is the case of Siemens Gamesa, despite the fact that its share price only lost 0.50% in the month. It is surprising, above all, if one takes into account that the wind turbine manufacturer was one of the main engines of the IBEX in 2020, with a revaluation of 111%.

The company began to show positive signs in recent days. On Thursday its shares gained almost 5% after expanding its portfolio with new projects in Europe. On Friday, although it lost steam, it managed to add another session in the green until it closed above 33 euros, far from the low of mid-March last year.

From that mark, the revaluation of Siemens Gamesa exceeds 170%. However, it could have reached its ceiling according to the Bloomberg consensus, which lowers its 12-month price to 31 euros, while most of the recommendations are to be maintained, with 11 positions in favor.

The electrical ones, big victims

There is a factor that hurts more defensive stocks. “If there is an entry into risk, it is possible that you exit the securities where you have positive responsibilities,” explains Susana Felpeto, from ATL Capital. The electricity companies are the major victims, with listed companies such as Iberdrola, which is down 3%, or Red Eléctrica, which already lost 7% in January and lost another 4%.

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