|Shares Out. (in M):||91,859||P/E||21.9x||17.7x|
|Market Cap (in $M):||4,521||P/FCF||8.0x||6.7x|
|Net Debt (in $M):||1,917||EBIT||288||348|
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1. Unique asset
2. Misunderstood story
B. Aviation business
3. Attractive real yield uncommon in current environment
1. Airport fee decision should come in next few weeks
2. Monthly traffic will continue to lead sell-side estimates higher, with positive yoy #s coming in Dec or Jan
3. Due to the low base in 1H09, traffic growth estimates for 2010 are still too low. Most analysts and guidance are at 0-2% traffic growth, but recently IATA predicted 4% traffic growth for 2010. I get to 3-4% even if I assume 0-1% growth from 4Q09 to 4Q10 just due to easy comps in 1H09.
4. External airports: continue to surprise on upside, sell-side hasn't fully accounted for their Turkish airports recent performance, and give no value for the recent St Petersburg win. Although no data has been given on St Petersburg, management believes this concession (Russia's #4 airport) will prove to be more valuable than Turkey's Antalya (which on a SOTP analysts estimate is 10-15% of Fraport's value).
5. Positioning: high short interest, at 15 days of volume, or 10% of free float (excluding strategic shareholders)
6. Rerating of infrastructure stocks as investors reach for real yield in a prolonged low interest rate world
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