Edenred "1H 2026 Results Recap" (Neutral) Forsythe

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Edenred "1H 2026 Results Recap" (Neutral) Forsythe

% ch Cons.

FY26 visibility improves, but durability of revenues remains the key debate

12/26E 1.81 1.89 4 2.01

As we move further into the period of Brazil regulatory implementation, it becomes 12/27E 1.95 1.95 -0 2.27

more and more evident the level to which Edenred over-estimated the potential impacts 12/28E 2.20 2.17 -2 2.55

(as they made abundantly clear at the time). This is certainly a positive development for

the shares and for Edenred operating results. However, intrinsic (ex Brazil & Italy Justin Forsythe, CPA

regulatory impact) operating revenue growth is the most important indicator of strength Analyst

justin.forsythe@ubs.com

in the business - which also remained stable at ~8%. With the benefits of face value (i.e.,

+44-20-7567 4191

25% increase in Italy, Belgium), fuel, disposal of low growth businesses, etc. bulls will

also be hopeful for a return to the persistent 10% (intrinsic) operating growth we saw in Michael Briest

2H25, 2024, and 2023. Further macro deterioration remains a key downside flex not Analyst

michael.briest@ubs.com

fully yet materialized. Management reiterated confidence in 8-12% LFL EBITDA growth

+44-20-7568 8367

in 2027 and 2028, supported by platform convergence and data and AI efficiencies.

With Q3 expected to represent the regulatory trough and visibility still limited on how Mahir Bidani, ACA

much Brazilian pressure may shift into 2027, we see improved FY26 earnings visibility Analyst

mahir.bidani@ubs.com

and are more positively inclined, whilst looking for continued intrinsic operating

+44-20-7568 3963

performance to get incrementally constructive.

Valuation: Price target €19.00 (unchanged) valued on 10x NTM EPS and 7x NTM

operating EBITDA estimates, or a ~10% UFCF yield ex Float.