KEY THEMES
Companies continue to report their 2020 results. Late last week, we saw CI Capital Holding [CICH] report better-than-expected earnings, despite a weaker investment banking segment dragged by COVID-19. Meanwhile, company-specific news and events will continued to dominate the scene, in our view. After being brushed off the GlaxoSmithKline [BIOC] acquisition, Rameda [RMDA] is focusing now on growing its product portfolio this year. Also, the stock performance of Ibnsina Pharma [ISPH] continues to lag its counterparts in the health care sector despite growing its business with new agreements and benefitting off a better health awareness. Elsewhere, Speed Medical [SPMD], which reported EGP79mn in net income in 2020, is currently trading at a TTM P/E of 41x, quite a high multiple in view of the market’s high-growth expectations, valuing the company at EGP3.3bn. However, we calculate that for the stock to trade at 15x 2025 P/E, earnings will have to grow at a 5-year CAGR or 23%, perhaps questionable once COVID-19-induced boon subsides.
POSITIVE
CICH, RMDA, ISPH: Both CICH and ISPH are two of our long ideas published in our STANDPoint note. RMDA may see some interest on its expansion news.
NEUTRAL
SPMD: We believe the earnings boost SPMD is witnessing is only transitory and linked directly to COVID-19.
NEGATIVE
UNIP: Lower 2020 earnings confirm our short idea made in our STANDPoint note.