Altran Technologies: Feedback from company contact: margin seasonality now better understood
BUY, Fair Value EUR7.3 (+28%)
We reiterate our Buy rating and our DCF-derived fair value of EUR7.3. Last Friday the shares fell 6% on broker downgrades as doubts arose on the Altran’s ability to sustain an op. margin of 9% in 2013, while we cannot rule out the assimilation of 29.6m new shares issued a month ago contributed to this drop. We contend a 1-1.5ppt margin decline in H1 can be more than offset by a 2ppt increase in H2 thanks to 4.7 billable days more than in H1 and the benefit of the acceleration of restructurings as management intends to restore utilisation rates to normative levels next year.
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