Obrascón Huarte Lain, S.A. (OHLA.MC) | Investment Case

1. Company Snapshot

1.a. Company Description

Obrascón Huarte Lain, S.A. engages in the construction and concessions development businesses in the United States, Canada, Mexico, Chile, Peru, Colombia, Spain, Central and Eastern Europe, and internationally.It operates through Construction, Industrial, and Services segments.The company provides civil engineering works and building construction services for public and private-sector customers; and designs, constructs, maintains, and operates industrial plants and systems, including oil and gas, renewable energy, mining and cement, solids engineering, and fire-fighting systems.

It also offers property and infrastructure maintenance services for homes and offices, urban green areas, road networks, and social and health services, as well as develops real estate projects, and develops and operates mixed use hotels.The company was formerly known as Sociedad General de Obras y Construcciones Obrascón, S.A. Obrascón Huarte Lain, S.A. was incorporated in 1911 and is headquartered in Madrid, Spain.

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1.b. Last Insights on OHLA

The recent performance of Obrascón Huarte Lain, S.A. has been impacted by a downturn in the European stock market, with the pan-European STOXX Europe 600 Index falling by 2.21% due to concerns over inflated AI stock valuations and receding expectations for a U.S. interest rate cut. Business activity in the eurozone continues to expand steadily, but this may not be sufficient to offset the negative sentiment. The company's valuation may be affected by these market trends, and investors are likely reassessing their positions. Recent earnings releases have not been provided.

1.c. Company Highlights

Last Price	0.37
Change Percentage	-1.48%
Open	0.37
Previous Close	0.37
Market Cap ( Millions)	507
Volume	5748647
Year High	0.54
Year Low	0.27
M A 50	0.43
M A 200	0.38

FCF Yield	16.78%
Dividend Yield	0.00%
ROE	-8.62%
Debt / Equity	71.87%
Net Debt / EBIDTA	-64.76%
Price To Book	0.71
Price Earnings Ratio	-9.06
Price To FCF	5.96
Price To sales	0.14
EV / EBITDA	1.71

2. Transcript Summary

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3. NewsRoom

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4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (2.44%)

6. Segments

Construction

Expected Growth: 2.5%

Obrascón Huarte Lain, S.A.'s 2.5% growth in construction is driven by increasing infrastructure investments in emerging markets, urbanization, and government initiatives to improve transportation networks. Additionally, the company's strategic expansion into renewable energy and sustainable construction projects contributes to its growth momentum.

Industrial

Expected Growth: 1.8%

OHL's industrial segment growth of 1.8% is driven by increasing demand for infrastructure development, particularly in the transportation and energy sectors. Additionally, the company's strategic focus on renewable energy and sustainable infrastructure projects contributes to its growth. Furthermore, OHL's diversified geographic presence and strong order backlog also support its growth momentum.

Others

Expected Growth: 1.2%

OHL's 1.2% growth is driven by increasing infrastructure investments in Latin America, particularly in Mexico and Chile, where the company has a strong presence. Additionally, OHL's diversification into renewable energy and concessions has contributed to its growth, along with a solid backlog of projects and a strong financial position.

7. Detailed Products

Construction

OHL's construction segment provides a wide range of services including building, civil engineering, and industrial construction.

Concessions

OHL's concessions segment involves the development and management of infrastructure projects such as toll roads, airports, and ports.

Industrial

OHL's industrial segment provides engineering, procurement, and construction (EPC) services for industrial projects.

Services

OHL's services segment provides maintenance, operation, and management services for infrastructure and industrial facilities.

8. Obrascón Huarte Lain, S.A.'s Porter Forces

Forces Ranking

Threat Of Substitutes

The threat of substitutes is moderate for Obrascón Huarte Lain, S.A. due to the presence of alternative construction companies and infrastructure developers.

Bargaining Power Of Customers

The bargaining power of customers is low for Obrascón Huarte Lain, S.A. as the company has a strong reputation and long-term relationships with its clients.

Bargaining Power Of Suppliers

The bargaining power of suppliers is moderate for Obrascón Huarte Lain, S.A. due to the company's dependence on a few key suppliers for raw materials and equipment.

Threat Of New Entrants

The threat of new entrants is high for Obrascón Huarte Lain, S.A. due to the relatively low barriers to entry in the construction industry and the presence of new players in the market.

Intensity Of Rivalry

The intensity of rivalry is high for Obrascón Huarte Lain, S.A. due to the presence of several established players in the market and the need to compete for limited projects and resources.

9. SWOT Analysis

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

	Value
Debt Weight	52.27%
Debt Cost	3.95%
Equity Weight	47.73%
Equity Cost	11.26%
WACC	7.43%
Leverage	109.52%

11. Quality Control: Obrascón Huarte Lain, S.A. passed 3 out of 9 key points

Strong Liquidity

Low Deb

Strong Interest Coverage

Healthy Cash Flow

Operating Efficiency

Strong Return On Equity

Consistent Revenue Growth

Consistent Operating Cash Flow Growth

Margin Improvement

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

OHL

A-Score: 4.6/10

Value: 9.1

Growth: 4.0

Quality: 3.8

Yield: 0.0

Momentum: 9.5

Volatility: 1.3

1-Year Total Return ->

Instalco

A-Score: 4.5/10

Value: 6.7

Growth: 7.4

Quality: 6.2

Yield: 4.4

Momentum: 1.0

Volatility: 1.3

1-Year Total Return ->

Polimex-Mostostal

A-Score: 4.3/10

Value: 8.3

Growth: 4.1

Quality: 2.6

Yield: 0.0

Momentum: 10.0

Volatility: 0.7

1-Year Total Return ->

Fasadgruppen

A-Score: 4.2/10

Value: 8.7

Growth: 6.0

Quality: 2.5

Yield: 5.0

Momentum: 1.5

Volatility: 1.3

1-Year Total Return ->

YIT

A-Score: 3.9/10

Value: 6.7

Growth: 0.6

Quality: 2.5

Yield: 3.8

Momentum: 7.0

Volatility: 3.0

1-Year Total Return ->

Vestum

A-Score: 3.7/10

Value: 7.6

Growth: 5.9

Quality: 3.4

Yield: 0.0

Momentum: 3.5

Volatility: 2.0

1-Year Total Return ->

Peers Metrics

12.e Scoring ^Insights

12.f DCF ^BETA

Parameters

Short Term Growth

-9.56%

Short term Time

10.0

Long-Term Growth

2.00%

WACC

7.43%

Obrascón Huarte Lain, S.A. - ES0142090317

1. Company Snapshot

1.a. Company Description

1.b. Last Insights on OHLA

1.c. Company Highlights

Weak Momentum

Lower Quality

Lower Yield

Cheaper

Revenues Miss

More Volatile

Revenues Beats

Strong Momentum

2. Transcript Summary

3. NewsRoom

4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (2.44%)

6. Segments

Construction

Expected Growth: 2.5%

Industrial

Expected Growth: 1.8%

Others

Expected Growth: 1.2%

7. Detailed Products

Construction

Concessions

Industrial

Services

8. Obrascón Huarte Lain, S.A.'s Porter Forces

Forces Ranking

Threat Of Substitutes

Bargaining Power Of Customers

Bargaining Power Of Suppliers

Threat Of New Entrants

Intensity Of Rivalry

9. SWOT Analysis

Strength

Weaknesses

Opportunities

Threats

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

11. Quality Control: Obrascón Huarte Lain, S.A. passed 3 out of 9 key points

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

Peers Metrics

12.e Scoring Insights

12.f DCF BETA

Parameters

Short Term Growth

Short term Time

Long-Term Growth

WACC

Target Price

0.37$

Current Price

0.37$

Potential

-0.00%

Expected Cash-Flows

12.e Scoring ^Insights

12.f DCF ^BETA