Publicação
Equity research - Mota-Engil SGPS, SA
| Resumo: | This project consists of a detailed analysis of Mota-Engil SGPS, SA following the guidelines and recommendations of the CFA Institute. Mota-Engil SGPS, SA is the largest construction company in Portugal and one of the largest in Europe according to the latest Engineering News-Record (ENR) report. The company is present on several regions, including Europe, Africa and LATAM, and also in the Environment and Capital segment. Throughout the project, two methods were used to analyze the company, namely DCF and Multiples. The final recommendation is based essentially on the DCF model, placing the target price at €3.80, which means a potential appreciation of 18% compared to the value recorded on September 8, 2023. Due to the high risk associated with operations in Africa and Latin America, given the unstable political circumstances and the high volatility of the inherent currencies, the STRONG BUY recommendation is justified. In order to demonstrate the impact of these risks on the target price, the sensitivity analysis carried out included variations in factors such as the evolution of the construction industry and the country's risk premium. In addition, given the company's current highly leveraged circumstances, an analysis was carried out on the impact of fluctuations in the cost of debt. Finally, the Engineering and Construction industry is facing a transition cycle in view of the new ESG concerns, which can be expected to have a major influence on the long-term objectives of the constituent companies, such as Mota Engil. Focusing on profitability and achieving sustainable debt are the new CEO's main challenges. |
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| Autores principais: | Perdigão, Rodrigo Paulo Freitas |
| Assunto: | Equity Research Valuation Mergers & Acquisitions Mota-Engil SGPS, SA Political Instability Africa LATAM Cost of Debt Engineering and Construction ESG Equity Research Avaliação de Empresas Fusões e Aquisições Mota-Engil SGPS, SA Instabilidade Política África América Latina Custo da Dívida Engenharia e Construção ESG |
| Ano: | 2023 |
| País: | Portugal |
| Tipo de documento: | dissertação de mestrado |
| Tipo de acesso: | acesso aberto |
| Instituição associada: | Universidade de Lisboa |
| Idioma: | inglês |
| Origem: | Repositório da Universidade de Lisboa |
| Resumo: | This project consists of a detailed analysis of Mota-Engil SGPS, SA following the guidelines and recommendations of the CFA Institute. Mota-Engil SGPS, SA is the largest construction company in Portugal and one of the largest in Europe according to the latest Engineering News-Record (ENR) report. The company is present on several regions, including Europe, Africa and LATAM, and also in the Environment and Capital segment. Throughout the project, two methods were used to analyze the company, namely DCF and Multiples. The final recommendation is based essentially on the DCF model, placing the target price at €3.80, which means a potential appreciation of 18% compared to the value recorded on September 8, 2023. Due to the high risk associated with operations in Africa and Latin America, given the unstable political circumstances and the high volatility of the inherent currencies, the STRONG BUY recommendation is justified. In order to demonstrate the impact of these risks on the target price, the sensitivity analysis carried out included variations in factors such as the evolution of the construction industry and the country's risk premium. In addition, given the company's current highly leveraged circumstances, an analysis was carried out on the impact of fluctuations in the cost of debt. Finally, the Engineering and Construction industry is facing a transition cycle in view of the new ESG concerns, which can be expected to have a major influence on the long-term objectives of the constituent companies, such as Mota Engil. Focusing on profitability and achieving sustainable debt are the new CEO's main challenges. |
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