Cellnex falls with its bonus but does not rise with it, which marks the highest levels of the year

The Cellnex case finds no explanation. Despite the fact that due to its business profile and balance sheet it is a company whose evolution is linked to that of fixed income most of the time, this year it has fallen in elevator of the price of the debt when it has been the case but, on the contrary, when it has had to rise, it has preferred the stairsand with doubts.

And historically when the US bond has risen in required profitability (falls in price), Cellnex’s action has been penalized by being seen by the market as a bond proxy by your debt profile. The high leverage that weighs on its balance sheet (more than 6 times) causes financing costs and the weight of interest payments to influence the income statement. In fact, it is one of the Ibex companies where this item is equivalent to a greater part of the income.

So, when the opposite happens and less profitability is required from debt assets (the price rises), the stock market value of the tower should rebound, something that has not happened in recent months. If we look at the evolution of its action, so far this year 5.7% has been left despite the start of rate cuts by the ECB and the increase in expectations of future cuts. The correlation, however, is stronger with the T-Note, which hit profitability lows in September of around 3.6%, coinciding with the Torrera’s highs of the year, around 37 euros. Since then, the bond has returned to 4.2% and the title to 33 euros.

However, if we analyze the evolution of the bonds issued by Cellnex, they are in the zone of maximum price of the year, in contrast to the stock, which You have to recover 10% to return to your ceiling for the year in bag. Analysts have not given up their convictions despite the stock market depression that Cellnex has been experiencing for months and maintain their valuations well above the year’s highs. Specifically, the average target price is located at 46.3 euroswhat it gives a journey to action of almost 40%.

“Indebtedness continues to be the main debate among investors after the results presented for the third quarter, with net debt reducing at a slower pace than previously anticipated,” Morgan Stanley points out. “Cellnex continues to be a company with a high sensitivity to rates and any reduction in its financing cost would mean an automatic increase in its valuation,” they add. “We do not expect them to reach their leverage target until September 2026,” they conclude.

“In our opinion, the market continues to undervalue Cellnex’s ability to generate free cash flow and we estimate a total of 6,400 million after capex and land purchases between 2026 and 2030, to which we should add the possible divestments of around 4,000 million in non-strategic assets”, they explain in Kepler Cheuvreux.

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