* Altice (CL Buy): Upbeat on US & PT cost cutting, M&A options
Altice’s CFO gave new granular detail on the material opportunities for cost
reduction in US cable and at Portugal Telecom; the US adds both
diversification and an attractive source of M&A potential. European M&A
optionality remains substantial, including in France, where the
government/spectrum auction are not seen as obstacles to potential inmarket
consolidation.
* Liberty Global (Buy): Growth accelerating, mobile M&A optionality
LBTY’s CFO highlighted scope for accelerating mid-term OCF growth
driven by price take, network expansion, SME/SOHO, mobile and Liberty
3.0, a new strategy to exploit scale efficiencies. Given expected ongoing
secure supply of MVNO capacity, there is no imperative to buy mobile
assets, although at the right price this could be an attractive option.
* Com Hem (Buy): Confident as customer perception improves
CEO Anders Nilsson has "never been as confident" in 2015 growth
guidance (which implies a material recovery in 2H15 revenue growth). He
laid out how mid-single digit growth is sustainable in the longer-term and
can support shareholder returns of c.10% mkt cap in perpetuity. Com Hem
has structural quality and growth in line with cable peers plus higher M&A
optionality, but trades at a 30% discount to peers on 6.8% 2016E FCF yield.
* Tele Columbus (Buy): Highlighting growth and M&A opportunity
Tele Columbus’ CFO reiterated the company’s growth opportunity driven
by its planned network migrations and upselling, while also highlighting
attractive synergies that could be realized from potential consolidation with
large and small peers. This view was supported by the CFO of Primacom
(NC), who also laid out an attractive roadmap for Level 4 cable growth.
* Telenet (NR) BASE secures mobile future, open to cable M&A
Telenet’s acquisition of BASE reflected the increasing importance of mobile
to the business and, in its view, the attractive price at which it was able to
buy the asset (5.0x EV/EBITDA incl. synergies). Telenet continues to see
themselves as the natural consolidators of Belgian cable, and remain open
to further cable M&A in the near term if assets become available.
* NOS (Neutral): Returning to growth in a more rational market
Improving macro and potentially more rational pricing environment.