US listings often fail to boost European companies’ valuations

The European companies that have added the US list often do not see the rise of their assessment, the Financial Times have found the Financial Times, the presence of New York stock market is a guarantee of higher share prices.

An analysis of 12 European-List companies that have added the US list since Ferguson, CRH and including 2016 Flash – It has been found that in half the case, the evaluation has decreased, although in several cases there was no enthusiasm for the analyst who followed the stock. However, two-thirds of companies have enjoyed more fluidity after this step in their shares.

“You move to the United States and your share price does not improve,” said Richard Warner, a BCLP partner. “This is definitely not so straightforward.”

Have been tempted by European companies and their investors The huge increase in the US stock market In recent years, it believes that despite the recent market sales-they will enjoy higher income qualities there.

UK broker TP ICAP said last week that it was planning List New York’s Data BusinessIn February, London-List Glenco said that it was reviewing other places, including the United States, as a center of mining money as a mining historic Tihasik position as a possible major push for his shares to “appropriate” for business.

London-List Construction Group Ashthead Shift Its initial list to New York and its CEO has said “the benefit of the US initial list compared to other markets… Has become more apparent over the past few years.” The British Advertising Group has W. “Look” A switch, when the Director of French Resources Chewn This national step is also considered.

European policymakers urgently try to recover domestic markets and try to encourage companies to sit at home with FT search. In the UK, there are controllers Overhuld For the listed companies in an attempt to make London more competitive.

Companies analyzed by FT have added all the primary or additional listings – new quotes while keeping their European lists.

Ferguson and Guru Group Flooter Entertainment provided by UK -based plumbing equipment are among the groups that have added the US list in recent years, such as the dry bulk operator Himalayan shipping and pharmaceutical company Indivier.

FT Irish has found groups groups CRHIndigeno and Shipping Group Okianis Echo Tankers were the only companies that followed three arrangements – evaluation, share trading volumes and analysts – when the case – the expert Barford Capital and the Spanish infrastructure Ferovial did not experience any profit. Others were short in at least one measure.

Before this step, half of the company that was analyzed in the local market was less than half the company’s evaluation, smaller stocks hit more tightly. On average, the forward 12-month’s price/income ratio for smaller companies-those who were less than $ 10 billion in market capital were about 7 percent less in New York, while it was about 1 percent less for larger companies.

Apostolos Thomadakis, head of Think-Tank research at the European Capital Market Institute, said, “For small or mid-Cap European companies, a secondary list in the United States cannot create interest among US investors who are recognized by brands that show more global agencies.”

However, CRH has enjoyed a sustainable evaluation enthusiasm from its New York list. Its average P/E ratio has grown from 12 times in 18 months to an average of 15 times in 18 months before switching to the United States.

However, the flutter, which adds the US quote in January 2021, and then made New York its preliminary list in May, no improvement – its P/E ratio has been dropped from an average of 20.5 times to 26.5 times in the UK.

Former FTSE also did 100 elements Ferguson and Ferovial, whose average US evaluation was 9 percent and 11 percent lower after the US moved.

BCLP’s Warner said that the cost of the US is that the cost of the BCLP said that the cost of the legal, accounting and investment banking services can be more than $ 500,000 to $ 1 million depending on the fees charged by the stock exchanges. Companies also cost additional, ongoing reports to maintain a list that can run for thousands of dollars a year.

“There is a lot of direct expenditure and indirect expenses,” Kim Balle, chief financial officer of Torm, said, which added a list of Nasdak Exchange in 2017.

FT analysis does not take accounts of issues such as the company’s income release, regulatory change or sector evaluation, which can affect the P/E ratio of all any organization.

Most companies benefited from greater fluidity – with ease that shares can not necessarily remove the price. Large companies have had an average experience of increasing an average of almost fourfold while comparing them to their European-list shares, while small companies have increased by about 5 percent.

CRH’s fluidity is now almost seven times more in New York. However, the fluidity of Ferovial has wandered there: about 37,000 shares in the United States are transactions in the United States, compared to more than 1 million in Europe before and after the US move.

It was “As expected with the new Nasdak list”, told Ferovial FT that the group has the purpose of “developing excess fluidity in the United States over time.”

FT also learned that on average, analyst coverage of several companies was on average or no incentive, although the authorities often refer to greater visibility as the cause of New York’s presence.

Oliver Lazenbi, a partner in the Freshfields partner of the Freshfields, says: “All these things are limited, bank analysts and institutional investors do not necessarily resource [to cover every single company]The “

Investors and analysts take more notice to larger companies such as flutter or CRH, the perfect size of the US market.

Winston and strain partner Paul Amis said, “Attempts in a big sea tend to go to bigger fish.” “If you are tenths of that size, obviously you need to work more hard to create a wave”