Edenred Earnings: Shares Fall on Negative News From Complementary Solutions Segment

Wide-moat Edenred's shares fell in early trading as a second poor quarter in a row from the complementary solutions segment exacerbated the negative momentum of the stock. We find the July 23 drop in the stock price to be extreme and maintain our EUR 76 fair value estimate, making the stock attractive in our eyes. Operating organic revenue growth was north of 15% in the first half of the year, driven by the benefits and engagement and mobility businesses. Management nailed down a full-year EBITDA target of EUR 1.265 billion, an increase in the growth rate from prior guidance to 15% from 12%.