Brussels stock exchange: new spring for Melexis

European stock markets lost their cautious gains in late trading. Chip designer Melexis had its best trading day ever.

Last week, the stock markets on the Old Continent experienced some difficult days, but they were able to smooth out the dip on Monday and Tuesday. Investors find new fuel in robust business results. On Wednesday, most European stock market indices initially turned light green, but gains were lost in the last hour and a half of trading.

The Bel20

closed 0.2 percent lower. The Belgian star index had to release the limit of 3,900 points, which it briefly exceeded intraday for the first time since February 2023.

Melexis topped the Bel20 (+17.3%, 82.80 euros)

head and shoulders above the rest, thanks to a relief rally following the publication of its quarterly update. The car chip designer performed broadly in line with its own expectations and analyst forecasts in the first quarter. Turnover increased 6 percent to 242 million euros – exactly in line with the consensus. Operating profit rose 4 percent to 63.7 million, better than the 61 million analysts expected.

There was a net profit of 1.31 euros per share. For the whole of 2024, CEO Marc Biron maintains the forecast from the beginning of this year: 1 billion euros in turnover and a profit margin of more than 25 percent. Ergo: at least 250 million in operating profit, compared to a record profit of 261 million for the 2023 financial year.

It may seem strange that the market is reacting so euphorically to the figures of a company that is performing ‘as expected’, but investors have been worrying about a slowdown in the market for (electric) cars for quite some time. Nervousness had intensified since last week TSMC, the world’s largest chip maker, tempered its annual forecast somewhat due to weak demand for car chips.

“The fact that management indicates that the inventory correction at customers is over will be a relief,” says ING analyst Marc Hesselink. ‘But we also think that the risk of pressure on prices still remains, because producers are paying attention to their purchasing prices.’

Since the beginning of the year, Melexis’s stock price has already fallen by 21 percent, a loss that was virtually erased during Wednesday’s trading session. Melexis had the best trading day in its history.

Melexis’ update contrasted sharply with that of Barco

the day before. The Kortrijk image technology group fell below the mark in terms of both turnover and order intake. Following that miss, several stock exchange houses adjusted their expectations. KBC Securities analyst Guy Sips adjusts his price target from 19 to 18 euros. ‘Barco’s figures reflect the destocking that is underway among its customers. And demand remains weak in the Entertainment department.’ Sips sticks to his ‘build up’ advice.

“While all business units are experiencing market weakness, the main uncertainty lies with ClickShare’s future prospects (the meeting tool, ed.)‘, say ING analysts Marc Hesselink and Thymen Rundberg. ‘Barco needs a strong recovery in the second half to achieve its sales and margin targets.’

The analysts strongly doubt whether the Kortrijk image technology group can achieve these objectives. ‘Given Barco’s modest valuation, we maintain our ‘hold’ recommendation, but the price target will increase from 18 to 13 euros.’ The stock exchange Kepler Cheuvreux also lowered its price target from 19 to 14 euros.

These trims did not prevent the first bargain hunters from coming forward. Barco climbed 2.5 percent to 12.80 euros.

The warehouse rental company WDP

was at the back of the Bel20 platoon. As the group previously announced, shareholders will once again have the choice between a payment of the 2023 dividend in cash or in new shares. They can also opt for a combination of both. As a reminder: the dividend amounts to 1.12 euros gross or 0.784 euros net per share.

Anyone who opts for new WDP shares can acquire them for 23.52 euros each. That price, minus the gross dividend, represents a discount of 6.7 percent compared to Tuesday’s closing price (26.32 euros). 30 No. 6 coupons (worth the net dividend of 0.784 euros) are required per new share. The new WDP shares are entitled to dividends from 1 January 2024, so that the first dividend will be payable in the second quarter of 2025.

The Jos De Pauw family, WDP’s reference shareholder, has already announced that it will include its entire dividend in new shares. WDP fell 2.9 percent to 25.56 euros.

From the basement of the Brussels stock exchange, the penny share Crescent (-4.4%) showed

to hear from us again, and to report that investors will have to be patient for a little longer before the results are announced. The annual report will not be published on April 30 – the legal deadline – but only on May 28. Crescent says that the postponement is necessary due to the ongoing sale procedure of the IT services division 2invision. It has been certain since the update in February that Crescent will make a loss for the eleventh year in a row.