Friday, January 28

The Repsol bass player gets the batteries


The bear present in the shareholding of Repsol, Exodus Point Capital Management, fuels its operation in the energetic with three significant movements of the position in eight sessions, according to the records of the CNMV.

The hedge fund has seen the highest activity in the stock since it entered July, the month in which it made up to four adjustments in its attack.

Exodus’ current short position on Repsol adds 0.5 percent of the energy company capital with a charge against the shares of about 79.65 million euros at the end of the year.

The downward pressure from Exodus put an end to four years without bears in the shareholding of the company led by Antonio Brufau Y Joshua Jon Imaz when the hedge fund Steadfast Capital came to accumulate 0.62 percent of the capital stock.

The current attack is run by a hedge fund founded by Michael Geldband Y Hyung Lee in 2018.

Geldband, the visible head of Exodus, made a name for himself among the great managers of short positions on Wall Street since Millennium Capital, one of the world’s largest hedge funds with a high presence on the IBEX 35.

Movements to the beat of crude oil

Exodus has been repeating the same operation on Repsol since July, which consists of raising and lowering its position from 0.5 percent to 0.49 percent, except for one exception at the beginning of November in which it cut its attack to 0, 48 percent.

The beginning of hedge fund movements occurred in the heat of falling crude prices when the barrel of type Brent, the one with the highest international benchmark, moved lower, above $ 70.

The drop in crude oil meant for Repsol a decline of 20 percent of the titles at that time from the annual highs registered a month earlier.

Brent recovered and reached 86.40 dollars at the end of October, at which time Exodus halted its actions against Repsol to reactivate them with the new falls in oil due to the variant of the omicron coronavirus.

Ómicron shook the markets, but the Organization of Petroleum Producing Countries (OPEC) pointed out in its last report in 2021 that the impact on the oil market will be mild and short-lived.

OPEC argued that the world is preparing to live with Covid-19 and its challenges permanently and therefore expects demand to grow to 99.13 million barrels per day in the first quarter of 2022.

Good forecasts for this year

1.1 million barrels more than OPEC’s estimate for November, as the organization expects the recovery to be reflected in the first three months of this year hand in hand with the economic recovery.

Analysts who closely follow Repsol’s business and stock market evolution buy into this situation and their projections point to an ebitda for the energy company of 7,263 million euros for this year, a growth of 10 percent compared to what this course would show.

The consensus also estimates that has the ability to generate double digit free cash flow It will help stabilize capital investments and sustain an attractive dividend.

Once the pandemic is over, as reflected in the results presented by the company until September, Repsol has one of its great attractions in the remuneration of the shareholder, both through the dividend payment method and the repurchase of shares.

The dividend as a great attraction

Deustche Bank calculates a dividend yield for Repsol, including buybacks, of 7.8 percent, above the 4.8 percent average for its peers.

Repsol’s dividend yield from the consensus is 5.6 percent without taking buybacks into account, which allows the IBEX to enter the noble zone of the selective in this parcel at the level of the kings of the dividend in Spain, the great banking.

The increase in oil prices and debt control will be the levers to sustain the dividend and experts agree that Repsol has the capacity to do so.

Repsol will pay 0.30 euros gross per share on January 10 and in July it intends to pay 0.33 euros gross of the complementary dividend.

The majority of the market consensus urges to “buy” securities of the energy company. The company’s securities are trading at around 10.5 euros and the average target price is 12.83 euros, which is why it shows a 12-month appreciation potential greater than 20 percent.



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