Dresdner Kleinwort Wasserstein, the influential private equity unit of the Dresdner Bank Group, has conferred a “buy” accolade on Paris-headquartered Publicis Groupe, the world’s fourth largest agency conglomerate.
Upping the rating from its previous “reduce” status, DKW believes Publicis stock is undervalued in the aftermath of 2001, a year described by agency chairman Maurice Levy as “Chinese water torture”. The bank’s bullish stance was also weighted, it said, by “encouraging industry related and micro-economic factors” – although it stressed its caution about rival players in the world arena.
Publicis stock, currently trading at E29 ($25.9), would be more appropriately priced at E35 ($31.2), opines DKW. Last week, chairman Levy expressed confidence that the group would hit its fiscal targets for 2001, although he remains “extremely cautious” about 2002.
Meantime, Publicis was authorized by a shareholders’ meeting last week to issue convertible bonds to the approximate value of E600 million ($535m) in a bid to refinance debt [WAMN: 11-Jan-02].
News source: BrandRepublic (UK)