Sopra Steria Group: H1 15 analysts' meeting feedback: the positive side of the mergerBUY, Fair Value EUR111 vs. EUR90 (+14%)
We reiterate our Buy rating and raise our DCF-derived fair value to EUR111 from EUR90, as we increase our adj. EPS ests. by 12% for 2015 and 6% for 2016 (+EUR8/share), our medium-term lfl sales growth assumption to 4% from 3% (+EUR7/share), and our medium-term adj. EBIT margin assumption to 9% from 8.5% (+EUR6/share). Sopra Steria looks to be ahead of schedule on the cost synergies planned for 2015, while momentum on revenue growth and margins is improving.