Westend Brokers AG
- WKN: -
- Land: -
Nachricht vom 26.03.2012 | 10:33
Silvia Quandt & Cie. AG, Merchant & Investment Banking: In-between the lines - Bernhard Eschweiler
Silvia Quandt & Cie. AG, Merchant & Investment Banking / Schlagwort(e): Sonstiges
- Official and market forecasts for German growth are rising again
- Domestic demand, especially housing construction, seen as growth engine
- Upward revisions will support positive market momentum
In the second half of last year, we argued strongly against the widespread pessimism in financial markets. In particular, we did not believe in a double-dip recession in the US and a Chinese hard landing. Against this background, we also saw little risk that Germany could get pulled into a recession despite the drag from the Euro debt crisis. By and large our view has prevailed. Nevertheless, our 1.5% growth estimate for Germany in 2012 seemed overly optimistic compared to official and market forecasts. This is starting to change.
Over the last 10 days, three of the five leading German economic research institutes (IfW, IWH and RWI) raised their growth forecasts for this year as well as 2013. Market consensus forecasts have moved higher as well. More revisions from other official and market sources are likely to follow and will probably point in a similar direction. The only exception so far is the forecast of the government's expert advisory board (the so-called 5 'Wiseman'). This, however, was not a full-scale review, but a tiny interim adjustment, which incorporated the weaker data around the turn of the year.
To be sure, our growth outlook is still on the high side. For 2012, the gap is between 0.2 and 0.9 of a percent. For 2013, however, most new estimates are approaching our 2+% growth forecast. In terms of the quarterly profile, this implies that most forecasters still expect some weakness in the first half of this year. In contrast, we expect growth already to resume in the first quarter. Our positive estimate for the first quarter is mostly based on the rise in business confidence indicators, which imply a return to trend growth. The risk to our view is that the pick-up will start later than the indicators imply. Industrial production rose in January, but was still below the fourth- quarter average. Thus, industrial production will have to rise further in February and March to validate our view.
Cyclical and monetary shifts
The positive change in German growth forecasts reflects two key developments:
- First, signs that the global business cycle is regaining momentum. In the US, the proof is already in the numbers. In most other economies, rising leading indicators point to a turnaround.
- Second, massive monetary policy support. Most instrumental is the liquidity support from the ECB, which has prevented a financial meltdown in Europe and elsewhere. Furthermore, the policy shift in Emerging Markets, notably China, from tightening to easing provides real stimulus.
German housing recovery becomes reality
In the case of Germany, the improved cyclical and monetary conditions are complemented by positive domestic demand fundamentals. This is nothing new and actual figures have so far disappointed expectations, especially consumer spending. Still, there is reason for optimism. One area where positive fundamentals are starting to materialize is construction, especially for housing. The German housing sector is highly fragmented (by location, demographics and regulation), yet several developments stand out:
- While population growth has stagnated over the last ten years, the number of households has increased by nearly 7%.
- Labor market and income dynamics have improved markedly.
- Mortgage rates are at historical lows, both in nominal and real terms, and banks are happy to lend.
- Discouraged by the financial and Euro debt crisis and worried about inflation, Germans are looking for 'real' investment opportunities at home.
- Supply has not kept up with demand. The average housing completion rate over the last ten years was less than 3 units per 1000 residents. For the last five years it was barely two, while 3-to-4 units are needed over time to maintain housing stocks and standards.
- The demand-supply imbalance is likely to increase if better economic performance in Germany leads to more migration from the Euro-area periphery.
To be sure, Germany is unlikely to experience a US-style housing boom, but recovery is no longer a forecast. The Bundesbank reported in its February monthly bulletin that housing prices rose 5.5% in 2011, after 2.5% in 2010, which is a notable pick-up from the near stagnation in previous years. According to the federal statistics office, housing construction permits rose 22% in 2011. The Ifo institute expects that housing permits will rise 11% in 2012 and another 8% in 2013.
A supplementary development for the construction sector is the fallout from Germany's new energy strategy. First, new energy efficiency rules for housing
and tax incentives are leading to investments in insulation and better heating systems. Second, the replacement of nuclear power through renewable energy requires massive investments in the energy infrastructure, which has a large construction component. Against this positive demand backdrop, Germany's construction sector has some catch-up to do. Since the mid 1990s, the number of construction companies fell by 45% and the number of construction workers dropped by 53%. Not surprisingly, the February Ifo survey reported the first positive balance of responses from construction firms in over ten years.
Forecast changes to support market momentum
The change in official and consensus forecasts is important for markets, especially equities. So far, the rally has been driven by better economic news versus low expectations. The result has been short covering. Actual trading volumes have been relatively low. Markets have also been torn between stronger forward looking indicators (e.g. surveys) and softer backward data (e.g. production figures). The positive forecast revisions mean that not just the absence of bad news but genuine optimism will push market sentiment higher. This development is not only happening at the macro level but at stock levels as well. This is probably not the start of a lasting bull market, given the broader deleveraging environment, but the positive forecast revisions imply that the rally has some momentum left.
This analysis was prepared by Bernhard Eschweiler, Senior Economic Advisor, and was first published 26 March 2012, Silvia Quandt Research GmbH, Grüneburgweg 18, 60322 Frankfurt is responsible for its preparation. German Regulatory Authority: Bundesanstalt für Finanzdienstleistungsaufsicht (BaFin), Graurheindorfer Str. 108, 53117 Bonn and Lurgiallee 12, 60439 Frankfurt.
Publication according to article 5 (4) no. 3 of the German Regulation concerning the analysis of financial instruments (Finanzanalyseverordnung):
Article 34b of the German Securities Trading Act (Wertpapierhandelsgesetz) in combination with the German regulation concerning the analysis of financial instruments (Finanzanalyseverordnung) requires an enterprise preparing a securities analysis to point out possible conflicts of interest with respect to the company or companies that are the subject of the analysis. A conflict of interest is presumed to exist, in particular, if an enterprise preparing a security analysis:
(a) holds more than 5 % of the share capital of the company or companies analysed;
(b) has lead managed or co-lead managed a public offering of the securities of the company or companies in the previous 12 months;
(c) has provided investment banking services for the company or companies analysed during the last 12 months for which a compensation has been or will be paid;
(d) is serving as a liquidity provider for the company's securities by issuing buy and sell orders;
(e) is party to an agreement with the company or companies that is the subject of the analysis relating to the production of the recommendation;
(f) or the analyst covering the issue has other significant financial interests with respect to the company or companies that are the subject of this analysis, for example holding a seat on the company's boards.
In this respective analysis the following of the above-mentioned conflicts of interests exist: none
Silvia Quandt Research GmbH, Silvia Quandt & Cie. AG, and its affiliated companies regularly hold shares of the analysed company or companies in their trading portfolios. The views expressed in this analysis reflect the personal views of the analyst about the subject securities or issuers. No part of the analyst's compensation was, is or will be directly or indirectly tied to the specific recommendations or views expressed in this analysis. It has not been determined in advance whether and at what intervals this report will be updated.
Equity Recommendation Definitions Silvia Quandt Research GmbH analysts rate the shares of the companies they cover on an absolute basis using a 6 - 12-month target price. 'Buys' assume an upside of more than 10% from the current price during the following 6 - 12-months. These securities are expected to out-perform their respective sector indices. Securities with an expected negative absolute performance of more than 10% and an under-performance to their respective sector index are rated 'avoids'. Securities where the current share price is within a 10% range of the sector performance are rated 'neutral'. Securities prices used in this report are closing prices of the day before publication unless a different date is stated. With regard to unlisted securities median market prices are used based on various important broker sources (OTC-Market).
Disclaimer This publication has been prepared and published by Silvia Quandt Research GmbH, a subsidiary of Silvia Quandt & Cie. AG. This publication is intended solely for distribution to professional and business customers of Silvia Quandt & Cie. AG. It is not intended to be distributed to private investors or private customers. Any information in this report is based on data obtained from publicly available information and sources considered to be reliable, but no representations or guarantees are made by Silvia Quandt Research GmbH with regard to the accuracy or completeness of the data or information contained in this report. The opinions and estimates contained herein constitute our best judgement at this date and time, and are subject to change without notice. Prior to this publication, the analysis has not been communicated to the analysed companies and changed subsequently. This report is for information purposes only; it is not intended to be and should not be construed as a recommendation, offer or solicitation to acquire, or dispose of, any of the securities mentioned in this report. In compliance with statutory and regulatory provisions, Silvia Quandt & Cie. AG and Silvia Quandt Research GmbH have set up effective organisational and administrative arrangements to prevent and avoid possible conflicts of interests in preparing and transmitting analyses. These include, in particular, inhouse information barriers (Chinese walls). These information barriers apply to any information which is not publicly available and to which any of Silvia Quandt & Cie. AG and Silvia Quandt Research GmbH or its affiliates may have access from a business relationship with the issuer. For statutory or contractual reasons, this information may not be used in an analysis of the securities and is therefore not included in this report. Silvia Quandt & Cie. AG and Silvia Quandt Research GmbH, its affiliates and/or clients may conduct or may have conducted transactions for their own account or for the account of other parties with respect to the securities mentioned in this report or related investments before the recipient has received this report. Silvia Quandt & Cie. AG and Silvia Quandt Research GmbH or its affiliates, its executives, managers and employees may hold shares or positions, possibly even short sale positions, in securities mentioned in this report or in related investments. Silvia Quandt & Cie. AG in particular may provide banking or other advisory services to interested parties. Neither Silvia Quandt Research GmbH, Silvia Quandt & Cie. AG or its affiliates nor any of its officers, shareholders or employees accept any liability for any direct or consequential loss arising from any use of this publication or its contents. Copyright and database rights protection exists in this publication and it may not be reproduced, distributed or published by any person for any purpose without the prior express consent of Silvia Quandt Research GmbH. All rights reserved. Any investments referred to herein may involve significant risk, are not necessarily available in all jurisdictions, may be illiquid and may not be suitable for all investors. The value of, or income from, any investments referred to herein may fluctuate and/or be affected by changes in exchange rates. Past performance is not indicative of future results. Investors should make their own investment decisions without relying on this publication. Only investors with sufficient knowledge and experience in financial matters to evaluate the merits and risks should consider an investment in any issuer or market discussed herein and other persons should not take any action on the basis of this publication.
Specific notices of possible conflicts of interest with respect to issuers or securities forming the subject of this report according to US or English law: None
This publication is issued in the United Kingdom only to persons described in Articles 19, 47 and 49 of the Financial Services and Markets Act 2000 (Financial Promotion) Order 2001 and is not intended to be distributed, directly or indirectly, to any other class of persons (including private investors). Neither this publication nor any copy of it may be taken or transmitted into the United States of America or distributed, directly or indirectly, in the United States of America.
Frankfurt am Main, 26.03.2012
Ende der Corporate News
26.03.2012 Veröffentlichung einer Corporate News/Finanznachricht, übermittelt durch die DGAP - ein Unternehmen der EquityStory AG.
Für den Inhalt der Mitteilung ist der Emittent / Herausgeber verantwortlich.
Die DGAP Distributionsservices umfassen gesetzliche Meldepflichten, Corporate News/Finanznachrichten und Pressemitteilungen.
Medienarchiv unter http://www.dgap-medientreff.de und http://www.dgap.de
Westend Brokers AG treibt Umstrukturierung mit ...
Westend Brokers AG: Zusammensetzung des Aufsic ...
Westend Brokers AG: Silvia Quandt & Cie. AG fi ...
Silvia Quandt & Cie. AG, Brokerage & Investmen ...
Silvia Quandt & Cie. AG, Brokerage & Investmen ...
Anleihe im Fokus
Die DF-Anleihe 7,875%
Mit der DF Forfait AG vom wachsenden Welthandel profitieren
- Zeichnungsfrist: 21.05. bis 24.05.2013
- Laufzeit: 7 Jahre
- Kupon: 7,875% p.a.
- Volumen: bis zu 30 Mio. Euro
- ISIN: DE000A1R1CC4
Anleihe im Fokus
7,75% p.a. - Rendite aus Familienhand
– Zeichnungsstart: 23. Mai – Börse Frankfurt
– Zeichnung ab 1.000 Euro
– Laufzeit 5 Jahre
– WKN: A1TNA7
– 100% Rückzahlungskurs
HELMA Eigenheimbau AG: Kaufen
Die HELMA Eigenheimbau AG präsentierte für das Geschäftsjahr 2012 Rekordwerte. Auf Basis unseres DCF-Modells haben wir einen fairen Wert je Aktie von 22,75 € ermittelt. Ausgehend vom erwarteten 2013er-EPS von 1,64 € entspricht dies einem KGV von 8,4. Das Kurspotenzial beläuft sich auf nahezu 65%.
Der AKTIONÄR News
News im Fokus
Fresenius Medical Care AG & Co. KGaA: Bekanntmachung nach Art. 4 Abs. 2 der Verordnung (EG) Nr. 2273/2003
17. Mai 2013, 17:35
Analysts' conference call on 1Q 2013
15. Mai 2013
Original-Research: Plan Optik AG (von GBC AG): Kaufen Plan Optik AG
17. Mai 2013