Stifel initiates Compagnie des Alpes at "buy", saying the French operator of ski resorts and theme parks stands to benefit from lower snow levels at competing low-altitude resorts
The ski areas of the group's major resorts - Val d'Isère/Tignes, Méribel/Les Ménuires, Les Arcs/La Plagne - are all above 2,000m and boosted by a growing influx of skiers looking for reliable snow, Stifel says
"Over the past 20 years, 10% of French ski resorts have closed due to a lack of snow in low-altitude locations," the broker says, adding this will likely accelerate over the next few years due to global warming
Compagnie des Alpes, which owns two of France's largest theme parks, is also outperforming the European theme park sector thanks to an active investment strategy, Stifel says
It notes the market, concerned about global warming and economic slowdown, tends to underestimate the group's performance and growth
Stifel expects the group to suffer a small margin squeeze due to higher energy costs this year, but should see margins recover in 2024, as it continues to raise prices and benefit from stabilising costs
Shares are up 2.8% in early trading
(Reporting by Diana Mandiá)