Veolia: Accelerates Investments in Its Energy Business; Shares Fairly Valued

No-moat Veolia announced an acceleration of investments in its energy business to leverage energy transition opportunities. The group will release its full-year 2023 results and hold its triennial capital markets day on Feb. 29. We anticipate a 10% rise in the synergies target from the Suez integration due to the advance already taken. Nonetheless, this seems to be priced in as shares now trade in 3-star territory. We recommend waiting for a pullback to buy the shares. We maintain our fair value estimate of EUR 31.