PostNL N.V. : Significant support lines and low valuation
December 10, 2012 at 03:50 am
By
Share
BUY
Live
Entry price
Target
Stop-loss
Potential
€2.68
€0
€2.31
-100%
On the basis of the current prices and the latest earnings per share estimates from analysts, PostNL is part of the cheapest stock in the industry. This valuation of the company suggests the preservation of technical levels being tested.
According to analyst estimates, the company is trading, on the basis of current prices, 1.61 and 8.57 times the expected results for the next two years. Besides, the enterprise value is worth 0.52 times its sales. These valuation levels theoretically limit the potential for decline, except in case of strong downward revisions of earnings estimates of the company in the coming months.
The share has a bearish configuration below the EUR 2.69 resistance. Nevertheless, the potential drop is limited by the support area located at EUR 2.33 in daily data and EUR 2.35 in weekly data. These levels are tested for several weeks and have contained the downward trend, which reinforce their technical significance.
Investors could take a long position at the current price and benefit from the support in order to aim a technical rebound. A first objective may be fixed close to the EUR 2.91 resistance. A part of the position may be retained as the crossing of this resistance would boost the share to more ambitious goals. A stop-loss order could be fixed below EUR 2.33.
PostNL N.V. specializes in supplying mail, parcels and e-commerce services. The company also provides services in the area of data and document management, direct marketing and fulfilment. Net sales (including intragroup) break down by activity as follows:
- parcel delivery (58.3%): in 2023, PostNL N.V. delivered 343 million parcels in Belgium, the Netherlands and Luxembourg;
- mail delivery in the Netherlands (35.4%): 1,745 million postal items processed in 2023;
- other (6.3%).
Net sales are distributed geographically as follows: the Netherlands (85.3%), Europe (8.5%) and other (6.2%).