8 interesting Spanish Stocks

2012-12-22 14:01 -  , Value Investing

To enlarge my circle of competence, for me it proofed to be valuable to go through a list of stocks in a country from A to Z.
I already did this with Portugese stocks and Greek stocks and of course with German stocks several times, as they are my home hunting ground (maybe I should post an article about interesting german stocks here, if that is of interest).

To continue this, I proceeded with Spanish stocks recently. A usable list of Spanish stocks one can find on Bloomberg.com or at the Madrid Stock Exchange.

What kind of stocks am I looking at in Spain? I am searching for companies

  • where I think I could understand the business after investing some time
  • that have a long term earnings record that is at least relatively stable
  • that have an english annual report available

If the current price is cheap or expensive, doesn’t play any role yet. It is not my primary intention to find companies to invest in immediately (altough that would not be that bad…). May aim is to find companies that are stable, I can understand and want to follow long-term.

Generally my approach was to read the short company description on Bloomberg first. If that caught my interest, I proceeded with the company homepage, read a bit about what the company does, looked at the most recent balance sheet and the reported earnings of all available reports. If what I saw didn’t turn me off, the company made it on my list you find below.

Baron de Ley

Website: barondeley.com
Market Cap: 217 Mio. €
Equity: 175 Mio. €
Net Cash: 47 Mio. €

in Mio. € 2011 2010 2009 2008 2007 2006 2005 2004 2003 2002 2001 2000
Net Earnings:
(parent shareholders)
10.1 17.6 15.4 18.8 25.5 21.4 21.1 21.6 21.4 19.9 16.9 15.0

Baron de Ley produces wine in the spanish wine-growing district of Rioja.

Campofrio Food Group

Website: campofriofoodgroup.com
Market Cap: 468 Mio. €
Equity: 579 Mio. € (including 453 Mio. € Goodwill)
Net Financial Debt: 473 Mio. €

in Mio. € 2011 2010 2009 2008 2007 2006 2005 2004 2003 2002 2001
Net Earnings:
(parent shareholders)
-54 40 -5.2 -8.3 32.2 30.1 25.4 39.7 12.0 22.5 25.7

Campofrio is a food company. Last years earnings seem not to be that good, one should analyze this more precisely. Also the relatively high financial debt looks not so well. But earnings seem to be relatively stable all in all.

Distribuidora Internacional de Alimentacion

Website: diacorporate.com
Market Cap: 3170 Mio. €
Equity: 105 Mio. € (including 417 Mio. € Goodwill)
Net Financial Debt: 576 Mio. €

in Mio. € 2011 2010
Net Earnings:
(parent shareholders)
98 122

Numbers of earlier years are not comparable, but DIA seems to be profitable long-term. The company is a super market chain active in Spain, Portugal, France, Turkey, Brazil, Argentina and China.
Seems to be very successful and profitable, what unfortunately results in a high valuation of the stock.

Ebro Foods

Website: ebrofoods.es
Market Cap: 2217 Mio. €
Equity: 1587 Mio. € (including 818 Mio. € Goodwill)
Net Financial Debt: 391 Mio. €

in Mio. € 2011 2010 2009 2008 2007 2006 2005 2004 2003 2002 2001
Net Earnings:
(parent shareholders)
126 456 177 131 91 180 156 127 101 96 95

Claims to be “World leader in the rice sector” and “Second manufacturer worldwide in the pasta sector”.

Fluidra

Website: fluidra.com
Market Cap: 230 Mio. €
Equity: 326 Mio. € (including 194 Mio. € Goodwill)
Net Financial Debt: 206 Mio. €

in Mio. € 2011 2010 2009 2008 2007 2006 2005 2004 2003
Net Earnings:
(parent shareholders)
15.1 15.9 -7.0 21.0 32.6 27.5 20.8 20.3 12.5

Fluidra produces and makets systems for water treatment and agricultural irrigation equipment and swimming pool equipment.

Iberpapel Gestion

Website: iberpapel.es
Market Cap: 148 Mio. €
Equity: 206 Mio. €
Net Financial Debt: 7 Mio. €

in Mio. € 2011 2010 2009 2008
Net Earnings:
(parent shareholders)
22.9 22.6 7.0 7.5

Iberpapel is a paper manufacturer. The company owns also Eucalyptus plantations in Spain, Uruguay and Argentina. Wood of these plantations is mainly used to produce printing and writing paper.

Indra Sistemas

Website: indracompany.com
Market Cap: 1600 Mio. €
Equity: 1067 Mio. € (including 625 Mio. € Goodwill)
Net Financial Debt: 513 Mio. €

in Mio. € 2011 2010 2009 2008 2007 2006 2005 2004
Net Earnings:
(parent shareholders)
181 188 198 186 155 118 107 85

Indra Sistemas offers information technology and services. For example ticketing systems for public transportation, toll collecting systems and more.

Vidrala

Website: vidrala.com
Market Cap: 480 Mio. €
Equity: 312 Mio. € (including 59 Mio. € Goodwill)
Net Financial Debt: 189 Mio. €

in Mio. € 2011 2010 2009 2008 2007 2006
Net Earnings:
(parent shareholders)
44 50 41 41 39 29

Vidrala produces glass bottles in Spain, Portugal and Italy.

Conclusion

Of approximately 180 spanish companies 8 made it through my filter. A not uncommon percentage compared to other countries I screened this way.
Are these all interesting companies? Certainly not. I’m convinced I missed some interesting candidates. If you know other interesting Spanish stocks, please leave a comment!
Should you buy stocks of the companies mentioned? That needs further examination. To be honest, I am not overly enthusiastic about the valuations relative to equity and reported earnings. But without investigating the companies further, one could easily draw false conclusions.


Comments [2]

  1. — Fai · 2013-01-03 14:10 · #

    Hi Stefan, just discovered your blog thru http://vijourney.wordpress.com/ blog. Very interesting (both).

    I have been living in Spain for 25 years and I am a value investor but I used to avoid investing in Spain taking into account he situation of the country. However considering their revenue from outside Spain maybe you should have a look at:

    Telefonica (which I didt study deeply because it has a big debt, few months ago it eliminated its 11-12% dividend yield to start paying back the debt. It is one of the biggest spanish companies, it is a pure blue chip and it has a huge biz in Latin America.

    http://finviz.com/quote.ashx?t=tef

    The other one is Repsol, is as well one of the biggest spanish companies, almost all of its biz comes from outside Spain and it is a huge integrated Oil Company, not affected by the PIGS crisis:

    http://finance.yahoo.com/q?s=REPYY

    Thanks and Regards,

    Fai

  2. — Isabella · 2013-03-01 11:26 · #

    Hi! how do you invest in stocks in spain in the first place. I am American. Would I just go through an American brokerage firm and pick the Spanish stocks? I am a total newbie!!! Any info would help. Thanks so much!

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