Repeating in third place is the three-strong Deutsche Bank crew piloted by Georgy Ivanin. From their offices in Dubai, Istanbul and Moscow, the analysts maintain a sector portfolio of seven names, and they have become somewhat circumspect on the group overall. Russia’s macro slowdown and military intervention in the Ukraine have driven down most stocks in its transportation industry by some 20 to 30 percent, says Ivanin, but a recovery is likely once tensions deescalate. At the same time, he notes, the best-performing company in the regional transportation group has been United Arab Emirates–based marine terminals operator DP World, thanks to the economic boom in its home market. Ivanin cautions, however, that upside for the stock is now quite limited, after strong performance year to date; DP World’s Nasdaq Dubai–listed shares jumped 22.4 percent, to $21.67, over that period, against the sector’s 9.6 percent advance. Although the researchers deem valuations across the sector to be mostly attractive, “we have a more cautious view for our 2015 outlook,” the team leader reports, “as consumer confidence in the emerging market has decreased, due to negative trends in the macro situation.” They are, however, urging clients to buy Globaltrans Investment, a Cyprus-based rail freight operator, based on its “attractive valuation, high liquidity, good dividends and solid balance sheet,” he explains. The group’s target price for Globaltrans’s global depositary receipts is $13.44; they were trading at $10.95 at the end of May. See also Georgy Ivanin's profile in the 2013 Emerging Europe, Middle East & Africa Research Team in Transportation and Industrials. |
The 2014 Emerging EMEA Research Team: Transportation, No. 3: Georgy Ivanin & team