Because the European tank makes Leonardo take off on the stock exchange
What happens to the Leonardo stock on the Stock Exchange. Facts, numbers and comments
Leonardo's actions take off in Piazza Affari.
Second day of rally for Leonardo who leads the Milan Stock Exchange with a 3% rise to 9.78 euros, reports Ansa . Credit to Deutsche Bank. The German bank in fact advises buying, along with many other defense stocks in Europe, in anticipation of a more concerted spending by European nations for their local suppliers.
In particular, after the recent declarations by Frank Haun , managing director of the French-German consortium Knds, according to which Italy, Norway, Poland and the United Kingdom will soon enter the project for the European tank MGCS (Main Ground Combat System).
The hypothesis that leads to purchases is that Leonardo participates with Oto Melara in the MGCS project. “The flow of news around Oto Melara and Wass will continue in the coming months and Bestinver also recommends the purchase of the share” reports Milano Finanza .
All the details.
THE THRUST FROM DEUTSCHE BANK
The defense and aerospace group scores an increase of 3.46% to 9.81 euros at 14.26 after + 4.6% on the eve of the day.
"Since February 24, the date of the beginning of the Russian invasion of Ukraine, the stock of the defense group has registered an increase of 53.7%," recalls Radiocor . To push purchases further today there is a report by Deutsche Bank which raised the opinion on the stock to buy from hold, improving the target price from 7.60 to 12 euros. According to analysts, the group can take advantage of the current moment like other groups in the European defense sector. The group's sales are estimated to grow by 5% annually until 2025 and the free cash flow targets appear to be achievable.
ENTRY INTO THE EUROPEAN TANK?
The hypothesis of entry into the project for the European tank has also triggered purchases on the stock of the former Finmeccanica group. The program is the result of the cooperation between Knds – a joint-venture between the German Krauss-Maffei Wegmann (Kmw) and the French Nexter Systems – and the German Rheinmetall, launched in 2017.
Interviewed by the weekly Wirtschaftswoche , the CEO of Knds Haun stated that "Italy, Norway, Poland and the United Kingdom would like to participate as soon as possible" in the MGCS program. The accession of these countries to the program would be possible as early as 2023.
According to the CEO, in fact, “in addition to an army to equip, everyone also has the technology to offer, like Kongsberg from Norway or Leonardo from Italy”.
Leonardo's entry into the MGCS program is closely linked to the future of the subsidiaries Oto Melara and Wass, which the group intends to sell.
PERFUME: "KNDS IDEAL PARTNER"
Profumo also reiterated the idea of including the two companies in the project of the future European tank, the "Main ground combat system" (MGCS).
“We have always had a very solid and constructive relationship with Knds. From my point of view, we would be the ideal partner for them ”declared Leonardo's CEO Alessandro Profumo last week in a passage from an extensive interview with the German newspaper Faz .
As for the possible interest of the German Rheinmetall as a partner of Fincantieri, however, there has not yet been any contact .
BESTINVER'S COMMENT
“Positive news for Leonardo and the defense sector as a whole given what the Secretary General of NATO affirmed on the threshold of 2% of the GDP which should be considered a minimum for the member countries. Until yesterday this was considered a goal. We believe that the impact on Leonardo's mid-range targets should be positively influenced by the greater flow of resources on defense projects ”, commented Bestinver Securities this morning, as reported by MF .
The analysts recalled "that Leonardo is already fully involved in other European programs, from the Eurofighter fighter to Telespazio's satellite services, to defense electronics (including the recent 25% stake in the German company Hensoldt), but also in both the rival projects for future fighters: the German-French-Spanish FCAS (thanks to Hensoldt) and the British Tempest ”.
Finally, "We believe that the flow of news around Oto Melara and Wass will continue in the coming months, given the strategic weight that the decisions on the disposal of defense assets are assuming at this time, especially from a political point of view", specified Bestinver. confirming the buy rating and target price between 10 and 11 euros on the Leonardo stock.
This is a machine translation from Italian language of a post published on Start Magazine at the URL https://www.startmag.it/economia/perche-il-carro-armato-europeo-fa-decollare-leonardo-in-borsa/ on Tue, 12 Apr 2022 12:29:32 +0000.