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Ageas renounces a solid dividend and weighs on the Bel20. The insurer’s coupon will be even more generous in the future. That should compensate for a less frantic share buyback.
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The hip artist dad of a classmate of my son’s revealed to me that he recently bought his first share: Ageas. “For the dividend.” Ageas is very popular because of its profit distribution, not least with first-time buyers looking for a safe first introduction to the stock market.
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Investors in Ageas can rejoice. The dividend, for which the insurer is so loved, will rise further over the next three years. In a two-hour speech to shareholders in the name new CEO Hans De Cuyper aims to increase earnings per share by 6 to 8 percent by 2025. This should result in a payment of at least 1.1 billion to 1.2 billion euros per year. The focus will be on organic growth acceleration in Asia (excluding China) and on the health insurance business. Ageas also aims for external growth and expresses its ambition to enter a fourth European market through an acquisition.
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In our view, investors should no longer automatically expect an annual share repurchase from Ageas.
Jason Kalamboussis
Analist KBC Securities
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Particularly as a result of these takeover plans, investors do see an additional sweetener drying up: the purchase of own shares. ‘In our opinion, investors should not count on an automatic share buy-back every year,’ says analyst Jason Kalamboussis of KBC Securties. Ageas foresees EUR 150 million in share buybacks in the new strategy. “But that’s barring acquisition deals,” says Kalamboussis, who thinks the focus will increasingly shift to acquisitions.
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It is not surprising that Ageas is less keen on buying back its own shares. In recent months, the insurer seemed rather a sexy growth stock than a sluggish value company. Ageas has won almost a quarter since New Years.
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On Wednesday, the insurer noted 5.6 percent lower at 50.48 euros. But that has mainly to do with the detachment of the dividend of 2.65 euros gross. Taking into account that distribution, shareholders lose only 0.8 percent.
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Ageas
is the last in the Bel20
. The index is trading at 4,098 points just around noon and is slightly weaker than the European average.
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AB InBev
AB InBev
forms a counterweight to Ageas within the index. With 63.35 euros, the beer giant reaches its highest rate since the outbreak of the pandemic. The largest Belgian stock exchange company unveiled its sustainability plans on Tuesday, with updates on water conservation and sustainable barley extraction. This showed that the beer giant buys more than half of its barley directly from the growers.
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AB InBev is one of the most ambitious emission reduction players in its sector.
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AB InBev currently consumes 2.7 hectoliters of water to produce 1 hectolitre of beer. It is therefore close to its target of 2.5 hectoliters of water. Several initiatives on smarter water use were announced, including through collaboration with local authorities in regions where water is scarce. Although AB InBev has not yet set a concrete date to become carbon neutral, it aims to reduce emissions from its total value chain by a quarter by 2025. “This makes the company one of the most ambitious players in the sector in terms of emissions reduction’, responds Kepler Cheuvreux stock exchange.
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In addition, the intention was expressed to reduce the consumption of alcohol. Currently, 7 percent of AB InBev’s offerings are alcohol-free. The beer giant wants to increase that to 20 percent ‘within a few years’.
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Ecopack
If AB InBev wants to save water, you may want to consult Ecopack
. The water purifier from Tielt is again in the spotlight on Wednesday thanks to a ‘million contract’ with chemical company Vynova in Tessenderlo. Ekopak will build a plant there to purify Vynova’s wastewater and return it to the production process. The installation will supply the Tessenderlo site with more than one million cubic meters of pure water. The works will start this month and completion is scheduled for the third quarter of 2022.
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‘Proof that Ekopak is able to attract high-quality clients and gradually expand its client portfolio,’ says analyst Olivier Vandewoude of KBC Securities. Financial details are unknown.
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Montea
Montea
capitalizes on a fan letter from the City of London. Beurshuis Berenberg raises the advice for Montea from ‘keep’ to ‘buy’, the target price goes from 102 to 108 euros. Thanks to the pandemic and the accompanying boom in e-commerce and ‘nearshoring’ (companies that shorten their logistics chain, save.) set up the turbo and runs too increasingly in the spotlight among foreign investors.
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Analyst Kai Klose is full of praise for the management, which has increased profits by half since 2016, and also points to the great predictability of profits and therefore dividends. This is thanks to the almost full occupancy of the warehouses by quality tenants with an average lease of 7.5 years.
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“The current low debt ratio of 36 percent offers sufficient margin to realize additional growth in the medium term,” says Klose. ‘And with a share price that has recently lagged behind the sector, the current price with a profit yield of 4 percent offers a good entry opportunity.’
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Montea wins 1.4 percent to 96.9 euros.
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eye-catcher
The European stock markets remain close to home. The Bel20 is taking a step back, but that is largely the result of Ageas’s dividend cut of EUR 2.65 gross. On the broad market, Resilux cuts a gross dividend of 3 euros.
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Today is the last day for large investors to subscribe to the IPO of The Italian Sea. With Alychlo (Marc Coucke’s vehicle) and the luxury house Giorgio Armani, supervisor Berenberg has already found two cornerstone investors. The intention is that the yacht builder will be listed on the Milan stock exchange from Tuesday.
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