Morgan Stanley highlights solid earnings momentum in Europe

Investing.com -- Shares of Fresenius SE (ETR:FREG) surged more than 8% on Wednesday following its results, which analysts at Jefferies described as broadly in line with expectations but with improvements in key areas.

The German healthcare conglomerate, which operates across hospital management, dialysis services, and pharmaceutical manufacturing, posted solid revenue growth and a stronger financial position, boosting investor confidence.

Fresenius reported group revenue of €21.526 billion, marking a 7% constant currency growth, with Kabi delivering a 9% increase driven by biopharma expansion.

The segment’s EBIT margin expanded to 15.8%, with a structural target raised to 16-18%. Helios saw 6% revenue growth, with EBIT margins stable at 10%. The company’s leverage improved, with net debt-to-EBITDA now projected at 2.5-3.0x, down from 3.0-3.5x.

Jefferies analysts flagged cost-saving measures, which exceeded targets with €474 million achieved by FY24, surpassing the initial FY25 goal of €400 million.

Fresenius also committed to a 30-40% core net income dividend payout, reinforcing shareholder confidence. Despite foreign exchange headwinds and pricing pressures in China, the company demonstrated resilience across all business segments.

Fresenius' stake in Fresenius Medical Care (NYSE:FMS) remains a key focus, with potential monetization opportunities closely watched by investors. Further deleveraging and operational improvements will be central to future performance.

Jefferies maintained its “buy” rating on Fresenius SE, with a price target of €44, reflecting further upside potential.

Investing.com -- General Motors announced a new $6 billion share repurchase authorization, including a $2 billion accelerated share repurchase (ASR) program, and a dividend increase of $0.03 per share.

The company said its quarterly dividend will rise to $0.15 per share, up from $0.12, beginning with the next planned dividend in April 2025.

"The GM team's execution continues to be strong across all three pillars of our capital allocation strategy," said GM Chair and CEO Mary Barra. "We are growing our business thanks to our broad, deep, and compelling portfolio of ICE vehicles and EVs."

The ASR program will see GM advance $2 billion to executing banks to repurchase and retire its common stock. The final number of shares repurchased will be based on GM’s average daily trading price during the program, which is expected to conclude in Q2 2025.

Outside of the ASR, $4.3 billion remains available for additional opportunistic share repurchases.

"Our balance sheet remains strong, and we will be agile if we need to respond to changes in public policy," said CFO Paul Jacobson.

GM’s capital spending for 2025 is projected at $10 billion - $11 billion, including investments in battery cell manufacturing joint ventures. Research and development spending is expected to exceed $8 billion.

As of December 31, 2024, GM had fewer than 1 billion shares outstanding, down from a 2024 weighted average of 1.055 billion.

Investing.com -- E.ON SE (ETR:EONGn) met its 2024 earnings targets as investments in network infrastructure expanded across Europe and said it expects to achieve growth this year despite ongoing political and economic uncertainty.

Its shares climbed roughly 3% in European trading Wednesday.

The Germany-based electric utility company reported a 3% decline in adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) for 2024, totaling 9.05 billion euros ($9.52 billion). This was slightly above the 8.93 billion euros analysts had forecast, according to company-compiled consensus estimates.

E.ON said its adjusted EBITDA landed at the upper end of its guidance range of 8.8 billion to 9.0 billion euros.

In its core energy networks segment, adjusted earnings rose to 6.9 billion euros from 6.6 billion euros a year earlier, exceeding analyst expectations of 6.81 billion euros. The company attributed the increase to higher infrastructure investments across all European regions.

Adjusted group net income, E.ON’s preferred metric, declined 7% to 2.86 billion euros, in line with its forecast range of 2.8 billion to 3.0 billion euros. Analysts had expected 2.92 billion euros.

The company proposed raising its dividend for 2024 to 0.55 euros per share, up from 0.53 euros the previous year.

For 2025, E.ON projects adjusted group EBITDA of between 9.6 billion and 9.8 billion euros, with adjusted net income expected to range from 2.85 billion to 3.05 billion euros.

Looking further ahead, the company expects adjusted group EBITDA to surpass 11.3 billion euros by 2028, with adjusted net income reaching approximately 3.4 billion euros.

Barclays analysts said the “superior 2025/28 guidance” will be the “main focus” for investors, implying “Bloomberg consensus EPS upside supporting our argument of structural growth and an overdone share price underperformance.”

Separately, analysts at Morgan Stanley said they “expect a positive market reaction to FY results print & continued relief rally post German elections.”

Investing.com -- Deutsche Telekom (ETR:DTEGn) on Wednesday said it expects further earnings growth in 2025 after surpassing financial targets for the previous year.

The telecommunications giant reported an increase in revenue and profit for 2024, setting the stage for continued expansion in the coming year.

In 2024, Deutsche Telekom’s total revenue rose by 3.4% to €115.8 billion, while service revenues increased by 3.9% to €96.5 billion.

Adjusted earnings before interest, taxes, depreciation, and amortization after leases grew by 6.2% to €43 billion, while free cash flow AL jumped by 18.7% to €19.2 billion. Adjusted net profit saw an 18.3% increase, reaching €9.4 billion.

The company is forecasting further growth in 2025, with adjusted EBITDA AL projected at approximately €44.9 billion—an increase of around 4.5%—and adjusted free cash flow AL expected to rise by about 4% to €19.9 billion. Adjusted earnings per share are anticipated to climb to around €2, representing a 9% increase from 2024.

“We are growing across all business areas. Our flywheel, at the center of our strategy, is spinning and generating the momentum we need to keep building on the successes of 2024 in 2025,” said Deutsche Telekom chief executive Tim Höttges in a statement, describing 2024 as a “record year” for the company.

The company’s German operations saw strong demand for fiber-optic services, with more than 10 million households now able to access high-speed fiber plans.

Mobile service revenue in Germany grew by 2.1% in the fourth quarter, while the customer base for branded contract mobile services expanded by 1.2 million over the full year.

In the United States, T-Mobile US (NASDAQ:TMUS) continued its industry-leading performance, adding 6.1 million postpaid mobile customers in 2024.

The U.S. segment’s service revenues rose by 4.5% to $66.1 billion, and adjusted EBITDA AL increased by 8.1% to $30.9 billion.

Deutsche Telekom’s stake in T-Mobile US has increased to 51.5% as of January 2025, reinforcing its position in the North American market.

The European division marked its seventh consecutive year of earnings growth, with adjusted EBITDA AL up 8.1% to €4.4 billion. Revenue in the region increased by 5.2% in organic terms, and customer numbers for broadband and mobile services saw continued growth.

T-Systems, Deutsche Telekom’s IT services arm, met all its financial targets for 2024, with order entry rising by 10.8% to €4 billion despite economic headwinds in key industries such as automotive.

Revenue grew by 2.8% to €4 billion, while adjusted EBITDA AL climbed by 14.8% to €369 million.

For 2024, Deutsche Telekom plans to distribute a record dividend of €0.90 per share, subject to approval, and has outlined share buybacks of up to €2 billion in 2025.