CLOSING: EDENRED
Cashing in the vouchers
Post very average numbers we thought the technical selling would start as per our thoughts in mid September. We are 4% higher now. So although we still believe the company has structural issues we will book profits.
Currency headwinds are easing in south America and ongoing euro weakness will also benefit Edenred. They have also made a smart acquisition in an attempt to target the Asian market.
Closing here for +8.35% return.
FRENCH LOCAL TECHNICAL ANALYSTS JUMPING ON BOARD
Monday • 15 September 2014 • 15:36
Following the Berenberg downgrade last week a few French trading websites are pushing the sell case on a technical level . See link.
Still expensive on many metrics with big Latin Amercian exposure as brazil roles over.
Cash flow is not as good as it looks and the dividend payments well may be an issue soon.
It is no longer a growth company.
Reiterating the fundamental SELL case as the technical sellers mount.
SHORT SQUEEZE ANOTHER SHORT OPPORTUNITY?
Thursday • 24 July 2014 • 16:17
The squeeze is a good short set up in EDEN afrer missing estimates and conforming guidance. Short interest at 9%.
Still have the same issues of FX(although will be less in H2) and Venezuela exposure.
Cash flow is a problem as they pay a decent divi and need cash to fund issued vouchers.
The lack of topline growth will be an issue going forward.
Still trades on expensive metrics and not much room for error.
VENEZUELA FX EXPOSURE
Tuesday • 25 March 2014 • 08:57
Decent devaluation Venezuelan currency last night, keep an eye on EDENRED with Venezuela exposure and still trading on rich multiples (-ve).
LOOKING RISKY INTO TOMORROW’S INVESTOR DAY
Monday • 11 November 2013 • 08:57
Investor day tomorrow and most analyst are bullish on them.. (11 buys 8 holds and only 4 sells).
Well worth keeping an eye on the headlines coming out of the Investor day.
It is a good company but ST i feel they need to accelerate earnings given how it has re rated and any form of disappointment tomorrow could see people heading for the door.
Expensive on 20 x2015. See the the attached Grab showing divergence between current stock price and EPS leading indicator.
Watch out for any negative surprises on FX issues from Brazil and Venezuela as they have seen major devaluation and that looks set to continue and will have an increasingly negative effect on earnings.
They pay a good dividend but need cash to fund issued vouchers. Cash flow not as good as it looks.
Street is very Bullish on them so not much room for error.
Get short!
