Equity Research - Cofina, SGPS

Abstract

Cofina SGPS is currently one of the largest and prestigious companies operating in the Portuguese Media & Publishing sector. Founded in 1995 and publicly listed since 1998, Cofina was a Portuguese holding group of several companies operating in many different sectors and business areas, such as media, pulp, steel between others. However in 2005, there was a spin-off of its holdings and the company remained only associated to the media printing and publishing sector, namely newspapers and magazines. Cofina is also known for its strong management track record, which has driven the company to the leadership of the main media segments in Portugal, through an efficient and balanced portfolio. The main goal of this Equity Research project is to determine the intrinsic value of Cofina stocks, through a detailed analysis of the company performance in the last couple of years and also through an accurate prospection of the media market for the future. The valuation of the company was based on the Free Cash Flows to the Firm and the WACC methodology which was considered the most suitable for the company according to the literature review. In addition, we also performed a Relative Valuation to complement our analysis.