Public Joint stock company Rosseti Lenenergo (LSNGP.ME) is not a suitable candidate for an investment at this time. Here's why:
- Financial Performance Concerns: The company's financial statements show a decline in net profit margin from -12.5% in 2022 to -0.1% in 20231. This indicates potential financial struggles that could affect the stability and growth of the company.
- Dividend Yield: The dividend yield on ordinary shares is 1.86%, and on preferred shares is 10.53%2. While high dividend yields can be attractive, they are often a sign of a company trying to attract investors with higher returns, which may not be sustainable in the long term.
- Analyst Ratings and Price Targets: The consensus rating for LSNGP.ME is "Sell," with several analysts recommending strong sell or sell ratings3. This sentiment is supported by the average price target, which does not reflect a positive outlook for the stock.
- Market Conditions: The stock is currently trading at a significant discount to its estimated fair value, indicating that the market may have concerns about the company's future performance4.
- Company's Strategic Position: Rosseti Lenenergo is engaged in the transmission and distribution of electricity in the Russian Federation5. The company's operations are subject to regulatory and political risks associated with the country's energy sector, which could impact its performance.
In conclusion, given the negative financial trends, poor analyst ratings, and the current market conditions, it would not be advisable to invest in LB Stock IPO at this time.