Oponeo with “BUY” and the valuation of PLN 69.00 from BM PKO BP. The company’s shares gain nearly 6%

Dov Herman

4 years ago

In its latest report, the PKO BP Brokerage House valued Oponeo at PLN 69.00 with the recommendation “Buy”, which with the price on the day of issue equal to PLN 60.40 translates into a 14% growth potential. During today’s session, the company’s shares are booming, and their valuation has increased to PLN 64.

Oponeo with the recommendation “Buy”

In its latest report, the PKO BP Brokerage House valued Oponeo at PLN 69.00 (initiating report) with the recommendation “Buy”. The share price on the day of issuing the recommendation was PLN 60.40, which means 14% of the potential for increases. The OPONEO.PL Group is an online distributor of tires and rims, the origins of which date back to 1999. For many years, it has been a leader on the market of online tire sales in Poland. Since September 2007, the company has been listed on the Warsaw Stock Exchange (WSE). – We expect the company to develop dynamically (CAGR of revenues in 2020-26P at 12%) thanks to global trends in digitization, a strong consumer in CEE, a rapidly growing local e-commerce market (CAGR of revenues in 2020-26P on 17%), dynamic increases in Dadelo and Rotopino (revenue CAGR in 2022-26F at 20%) and new initiatives such as LAM (sale of metal ladders and racks). – analysts from the PKO BP Brokerage House indicate. – We believe that the current valuation is attractive (EV / EBITDA 2022P 11.5x, EV / EBITDA 2022P 10.2x) and at the beginning we are issuing a BUY recommendation with a target price of PLN 69 per share. – they also add.
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Oponeo with good forecasts

According to the forecasts presented in the report, sales revenues in 2022 will amount to PLN 1.36 billion, while in 2022 it will be over PLN 1.5 million. Analysts also expect an increase in net profit, the forecast of which is PLN 44 million throughout 2022 and PLN 48 million in 2022.

During today’s session, Oponeo recorded a very strong increase in its stock market valuation. The company is currently gaining 5.96%, which means an increase by PLN 3.60 compared to the previous closing, which was exactly PLN 60.40. Currently, investors are paying exactly PLN 64.00 for the stock, which means that the company is at its annual (and historical) highs.
Quotations of Oponeo on 07/09/2022. Source: Stooq.pl – We estimate the CAGR of the volumes of tires sold in 2020-26P at 5% (including + 9.4% y / y in 2022P), which results from the market recovery in Poland in 2022 and acceleration of international expansion in subsequent years (+ 74% in 3Y). We estimate that Oponeo will increase its share in the tire market in Poland by 5 pp. to 35% in 2026P, while the tire market in Poland (excluding imports from Asia) will shrink by 1% annually over the period covered by our forecast. – indicates the PKO BP brokerage house. – We consider the current valuation (2022P P / E 19.3x; EV / 2022P sales 0.5x; FCF in 2023P 5.1%) to be attractive and even with our optimistic e-commerce market and decline assumptions volumes on the tire market in Poland (2020-26P CAGR of revenues at -1%, excluding imports from Asia), we see growth potential. – they also add.
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