EU TRANSPORTATION: DSV; FY (to Dec) results
(DSVDC; A3/A- Neg)
Beta for credit will come from how it integrates Schenker (similar sized revenue but runs near-half the margins). Otherwise looks in-line/stable for now. Long-end (8-10y) has struggled to perform since issuance at end of Oct - belly/short-end is -15-20 tighter vs. index -6. Impressive performance there and is mirrored in equities. No firm view on secondary.
- FY guidance it had given us when it priced its €5b Schenker supply was EBIT of DKK16-17b. It reported bottom end of that (DKK16.1b, ~€2.2b) this morning. Q4 EBIT was +0.2%yoy to give that result.
- FY25 guidance is for EBIT between DKK15.5-17.5 - simply a wider range to this years. Has assumed stable to slightly lower yields in both air (1/3 of group) and sea (~1/3) for next year.
- It has not yet closed on Schenker but the funding across equity/credit is done; on this years earnings it will be pro-forma levered net 3.0x, unch from values we quoted earlier this year.
- Reiterates net 2.0x target within 1.5-2yrs
- Annual dividend of DKK1.7b/~€230m (unch yoy) - a tad high pay-out of 16.5% of net-income.
- Moody's actually assumed dividends to be paused, S&P seems to have been correct in assuming 10-15% pay-out would continue but buybacks would be paused.
- Bonds did come with a 101 SMR, all regulatory approvals have been achieved, expects to close in Q2.
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Historical bullets
JGB TECHS: (H5) Returns Lower
- RES 3: 149.55 - High Mar 22 (cont)
- RES 2: 147.74 - High Jan 15 and bull trigger (cont)
- RES 1: 144.48/146.53 - High Nov 11 / High Aug 6
- PRICE: 142.12 @ 15:01 GMT Jan 03
- SUP 1: 141.65 - Low Dec 30
- SUP 2: 141.56 - 1.764 proj of the Aug 6 - Sep 3 - 9 price swing
- SUP 3: 141.05 - 2.000 proj of the Aug 6 - Sep 3 - 9 price swing
Markets slipped on the hawkish Fed and are yet to fully recover, touching 141.65 on the way lower. Medium-term trend signals on the continuation chart continue to point south. A resumption of the trend would pave the way for a move towards 141.56, a Fibonacci projection point on the continuation chart. A stronger recovery would open 144.48, the Nov 11 high. Further out, key resistance is at 146.53, the Aug 6 high (cont).
USDCAD TECHS: Bull Flag Highlights A Clear Uptrend
- RES 4: 1.4669 2.0% 10-dma envelope
- RES 3: 1.4539 3.382 proj of the Oct 17 - Nov 1 - 6 price swing
- RES 2: 1.4508 3.236 proj of the Oct 17 - Nov 1 - 6 price swing
- RES 1: 1.4467 High Dec 19
- PRICE: 1.4392 @ 15:50 GMT Jan 3
- SUP 1: 1.4336 Low Dec 20
- SUP 2: 1.4307/4232 20-day EMA / Low Dec 17
- SUP 3: 1.4136 50-day EMA
- SUP 4: 1.4011 Low Dec 5
USDCAD is unchanged and bulls remain in the driver’s seat. The latest pause appears to be a flag formation - a bullish continuation signal. Note too that moving average studies are in a bull-mode position, highlighting a dominant uptrend. Sights are on 1.4508 next, a Fibonacci projection level. Initial firm support to watch lies at 1.4307, the 20-day EMA. A pullback would be considered corrective.
AUDUSD TECHS: Southbound
- RES 4: 0.6471 High Dec 9
- RES 3: 0.6408 50-day EMA
- RES 2: 0.6341 High Dec 18
- RES 1: 0.6247/6282 High Dec 30 / 20-day EMA
- PRICE: 0.6204 @ 15:21 GMT Jan 3
- SUP 1: 0.6179 Low Dec 31
- SUP 3: 0.6158 1.236 proj of the Sep 30 - Nov 6 - 7 price swing
- SUP 3: 0.6100 Round number support
- SUP 4: 0.6045 1.500 proj of the Sep 30 - Nov 6 - 7 price swing
A bearish trend condition in AUDUSD remains intact and the pair continues to trade closer to latest lows. Recent weakness maintains the price sequence of lower lows and lower highs. Note that moving average studies are in a bear-mode position too, highlighting a dominant downtrend. Scope is seen for an extension towards 0.6158 next, a Fibonacci projection. Initial firm resistance to monitor is 0.6282, the 20-day EMA.
