Proximus SA
| Morningstar Rating for Stocks | Fair Value | Economic Moat | Capital Allocation |
|---|---|---|---|
| LOCK|<>?T!Z@ | LOCK|$! | LOCK|vR |
Proximus Earnings: Guidance Raised, but Competition Looms
Narrow-moat Proximus reported pro forma third-quarter underlying domestic revenue growth of 3.5% and underlying domestic EBITDA growth of 3.7%, ahead of guidance for both metrics. Management raised its 2024 guidance for both, from 2.5% to 3% and from 2% to 3%, respectively. They also raised guidance for underlying group EBITDA from 2.5% to 3%. While these results have been well received in the short term, Proximus’ medium-term outlook is uncertain as the entry of Digi approaches, which aims to take 10% market share in Belgium. Still, shares look undervalued, trading at a 3.7 times enterprise value/EBITDA and we maintain our EUR 9.20 fair value estimate.
