Nicolas Mora, an analyst from Morgan Stanley, reiterated the Buy rating on Aeroports de Paris ADP. The associated price target is €139.00.
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Nicolas Mora has given his Buy rating due to a combination of factors influencing Aeroports de Paris ADP’s potential growth and value. One significant aspect is the upcoming Economic Regulation Agreement, which is expected to span approximately seven years with a regulated return on capital employed of 5.5%. This agreement includes over €8 billion in regulated capital expenditures and a projected average tariff increase of 4.5% over the period. Mora anticipates that front-loading some tariff hikes in 2027-28 could help smooth the return profile and reduce the discount to the regulated asset base implied by the current share price.
In addition to regulatory factors, the retail segment is also a consideration, despite some expected disruptions due to construction at Charles de Gaulle Airport. Mora foresees a gradual improvement in luxury goods sales momentum, which could offset some of the short-term challenges. Furthermore, traffic trends are promising, with a solid outlook for seat capacity growth into the 2025/26 winter schedule, suggesting a rebound or strengthening in key markets. These elements combined make Aeroports de Paris ADP an attractive investment opportunity, justifying the Buy rating.