During a roadshow with Suez, the main 2016 short-term guidance was reiterated, as well as more strategic 2017 “ambition” targets. Like Veolia, and other European environmental service groups, Suez is suffering from the lack of growth in its traditional business and thus has no choice but to optimize its costs structure, look for growth internationally and strive for external growth. All three options are well addressed by Suez’s management, with one common objective: not altering the group’s equilibrium (financially, and in terms of business). At the current share price, we assume M&A opportunities, although well identified, are not fully priced in by investors. We remain buyer.
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