(News Bulletin 247) – Oddo BHF maintains its Outperformance recommendation on the Edenred share and its target price of 64.5E.
‘Reward Gateway seems to be a good target in a rapidly growing business and Edenred benefits from a solid track record in terms of mergers and acquisitions and integration’, recognizes the analyst.
Nevertheless, the EV/EBITDA multiple of 20x post-synergies paid for the acquisition seems “quite high, given the accretion that we are calculating”, specifies Oddo BHF.
“Our recommendation is motivated by significant growth prospects, a still significant margin improvement margin and strong FCF generation (cash conversion rate of >70%),” continues the broker.
And to detail: ‘The valuation of Edenred at 23.7x in terms of P/E 2024e shows a discount of around 15% compared to its average NTM multiple of the last six years.’
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