(News Bulletin 247) – The media, communications and video games group saw its revenues increase by more than 3% on a comparable basis in the third quarter, thanks to the growth of the encrypted channel and Havas. The finalization of the acquisition of Lagardère was also postponed by a few months.

Ousted from the CAC 40 in June by Edenred, Vivendi has since not really regained any color on the stock market, its price having appreciated by barely 1% since June 19, the date of its expulsion from the benchmark index. from the Parisian square. Even if it should be noted that over the same period the SBF 120 fell by 8%.

However, the media and communications group, almost 30% owned by the Bolloré group, posted a fairly good performance this Friday, gaining 2.6% around 2:45 p.m. in a market in very sharp decline since the SBF 120 dropped at the same time. moment 1.3%.

Investors appreciate the group’s publication, Vivendi having revealed its third quarter activity after Thursday’s close.

The company recorded revenue growth of 2.5% on a published basis, to 2.43 billion euros, and of 3.1% on a comparable basis, more than expected by analysts, notes Deutsche Bank. The establishment welcomes “a set of solid results”. The independent research firm AlphaValue, for its part, highlights “good figures for Canal+ and Havas”.

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Gameloft penalized by a high comparison base

The encrypted channel generated revenues of 1.5 billion euros over the period, up 5.4%, growth itself driven by the good momentum of television activities in France (+6.9% ) and Studiocanal (+24.5%). The co-production, acquisition and distribution company of audiovisual works has benefited from the success of certain releases since the start of the year, notably the film Alibi.com 2 by Philippe Lacheau which achieved 4 million admissions in France.

For its part, Havas recorded growth of 4.5% in its net income. “After achieving a very good second quarter of 2023 with organic growth of 6.3%, Havas’ activity remained dynamic, supported by the growth of all its divisions,” explained Vivendi.

Although this performance is “solid”, it is nevertheless lower than that of Publicis, notes AlphaValue. Publicis, it is true, recorded like-for-like growth of 5.3% in the third quarter. But the group led by Arthur Sadoun is currently on the rise to the point of beating all of its competitors in advertising and communication.

Growth is, however, weighed down by the 22% drop in revenues of the Gameloft video game group to 74 million euros, due to an unfavorable basis of comparison, the third quarter of 2022 having been driven by the success of the Disney game Dreamlight Valley.

Note that Vivendi announced on the occasion of this publication a slight postponement of the finalization of the acquisition of Lagardère, the group now counting on a deadline “by the end of the year” versus by end of October previously.

A high discount and potential for UMG?

“We reiterate our purchase advice with an unchanged price target of 11.3 euros offering an upside potential of 35%,” indicates Deutsche Bank which also highlights the low valuation of the stock.

“The market value of investments in listed shares represents the entire market capitalization of Vivendi, which implies that the consolidated assets are valued at a significant discount compared to the intrinsic value on the basis of 1 times the Ebitda (result gross operating income, Editor’s note)”, explains the German bank. “Next catalysts include the completion of the Lagardère acquisition by the end of 2023 and a potential resumption of share buybacks,” she adds.

AlphaValue also remains a buy, specifying, however, that its recommendation is mainly linked to Universal Music Group (UMG), the fast-growing record company that Vivendi deconsolidated from its accounts by listing it on the Amsterdam Stock Exchange at fall 2021. But the media group still holds 9.98% of UMG’s capital.

“Vivendi’s stake in UMG (around 4.5 billion euros), which represents around 50% of its market capitalization, still has some potential – which, in our opinion, is not really the case for Canal+ for Canal+ and Havas”, notes AlphaValue.