Buy Signal on Lagardère (MMB-FR)
Lagardère is a €2.6 bn market cap, and one of the world leaders in the publishing, production, distribution and distribution of content, whose strong brands generate and meet qualified audiences thanks to its virtual and physical networks.
Revenues are split between Lagardère Travel Retail (62%): distribution of press, communication products and cultural leisure activities; and Lagardère Publishing (38% of sales) including the publishing of books and works in the fields of general literature and education, illustrations and booklets.
Lagardère expects its Publishing activities to gradually return to 2019 levels at the end of 2020 while the Travel activity should remain subdued and is expected to recover modestly in 2020. The company is expected to post a c.€420M losses in 2020 (versus -15M€ in 2019) and to recover in 2021.
There is now a speculative premium building on the stock in the wake of the 27% stake from Bernard Arnault, via Financière Agache, and 5.5% by direct acquisition that may lead to further M&A operations. This is clearly a positive for the stock, while Vivendi and Amber still own 45% of the group.
Short term catalyst: LVMH/ B. Arnault stake in Lagardere.
This signal looks mainly company specific.