Stobart Group: Unlocking Exceptional Shareholder Value
Edison | Aug 07, 2017 07:37AM ET
Through a combination of forecast high growth from its core Aviation, Energy and Rail businesses, and cash realisations from its legacy Infrastructure and Investments divisions, Stobart Group Ltd (LON:STOB) offers an attractive equity proposition. We forecast three-year group EBITDA CAGR of 18% as management executes its growth plans. Further asset disposals will likely return more than enough capital to cover the more than £60m annual cash dividend payout and further strengthen the group balance sheet. Over the long term, we believe the group could unlock significant value from its core assets, especially Southend Airport, which is set to be a major beneficiary of airport capacity constraints in the South East.
FY19 targets in Aviation and Energy achievable
Achievement of STOB’s ambitious FY19 operating targets should be aided by strong divisional management teams in both Aviation and Energy, coupled with attractive end-markets. We expect good progress towards divisional targets over the course of FY18, which will allow the market to look to the longer-term value intrinsic in STOB’s core assets, especially Southend Airport.
Stobart Group - Unlocking Exceptional Shareholder Value
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