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Inditex announces a dividend increase of 33% and comfort to analysts

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Inditex announces a dividend increase of 33% and comfort to analysts

Inditex has just published the closing of a fiscal year with results that neither locals nor strangers have liked. With a net result of 3,243 million euros and increases of 193%, in a punishing environment for the company and which means, in the face of the toughest year of the pandemic with the confinement and closing of stores, 400 million euros below the figures from before the arrival of the coronavirus.

Inditex results of the company at the end of its fiscal year

Inditex results of the company at the end of its fiscal year

Regarding recommendations, from Banco Sabadell change its advice to buy from sell despite its sharp declines since the beginning of the year and despite the fact that the improvement implies at the expense of a cut in its target price of 10% in which the impact of Russia’s war against Ukraine is included. But so far the good. Consider that the figures are clearly bad and below expectationsin the fourth quarter, with deterioration in sales and drop in sales and, to a greater extent, in Ebit.

From Credit Suisse underweight the stock because considering that, from its current levels, the security does not present a path with a downward target price since its listing, €21 per share. In Bankinter there is also clipping in recommendation, to neutral from buy with a PO of €26.5 per share and from Renta4 will review their stock overweight advice, with a PO of 35 euros. But in all cases, the results are disappointing. From Telsey Advisory Group rThe target price of the security is lowered to 27 euros from the previous 33 while Morgan Stanley has the same, leaving its target price at 24.50 euros of the previous 20 euros per title for the textile company.

In its graph we see that the value yields 4% in the week, reading of results included, with cuts of 14.6% in the month, 20.8% in the quarter and so far this year the fall in value in the market, punished first by the situation and then by the war and its presence in Russia mainly, 23.87%.

Inditex annual stock price

Inditex annual stock price

The best, the dividend: has announced a rebound with the law of Marta Ortega and Oscar García Maceiras of 33%. Altogether we are talking about a total dividend of 0.93 euros per share, that is, 2,878 million in total. The first installment will correspond to May 2 and the second, on November 2 and will be the same: 0.465 euros in each one. This corresponds to 0.63% of the ordinary dividend and the 30 cents that remained to be paid in the extraordinary dividend for the 2019-2021 period, extended until this year, due to the freezing of its payment in the pandemic.

For Néstor Borrás, independent analyst Inditex “manages (1) to bounce from the last support level, in lot 17.79 euros per share and (2) a daily close above the bearish gap of 21.16 euros. The next sign of strength would trigger a daily close above the next downside gap, location on a plot 24.61 euros and,subsequently, breaking the last previous decreasing maximum of the downward trend, at 26.59 euros per share”.

Inditex in daily chart with average amplitude range in percentage, MACD oscillator and trading volume

Inditex technical analysis of value

Inditex technical analysis of value

The premium indicators elaborated by Investment Strategies leave us, in bearish mode, a slightly improved score, but that only reaches the 2 points of the 10 possible for the value. With medium and long term downtrend, medium and long term negative total momentum and amplitude range, volatility, growing on both sides. Only positively does it preserve the volume of business, which is growing, in the medium and also in the long term.

For Javier Alfayate, from GMP stock company highlights that “it is a value that a priori has a very interesting good behavior from the technical point of view, in addition to all this it did it coming out of the extreme oversold zone, with the stochastic cut upwards. In short, apart from the fact that there could be small corrections to purge this strong rise that it has had since its minimum, it is a value that could continue with the recovery and we were able to establish a reference area in the short term around 24.30 euros, what would be the next the next zone of resistance and supports right now because all the area between 20.80-20.90”

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