The positive outlook of the US (despite a mediocre start to the year due to adverse weather) is still counterbalanced by weak market conditions in Egypt and Greece for which we expect now an even slower pace of recovery. On the other hand, group’s strong market position in the US and competitive cost structure in all regions should translate to solid FCF generation (average 5-year FCF yield of 8%), allowing management to combine deleveraging, satisfactory dividend and growth capex. Overall, our revised estimates result in a target price of EUR 22.00 from EUR 22.40 previously, which at current market levels yields a “Neutral” recommendation. ΓΌ Greece : Continued weak residential demand and delays in the implementation of new infrastructure projects after the completion of four motorways in 2017 point to a high single-digit drop in domestic cement demand in 2018. On the other hand, cost savings (a EUR 4m staff reduction charge was taken in 4Q17) and high export ...
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