Deutsche Bank improves Prosegur by 18% after the agreement with Telefnica

Investors are not the only ones who reward Prosegur for their agreement with Telefnica in the alarm business. The alliance has put the security company in focus, and analysis firms such as Deutsche Bank have revised their valuation up 18%.

Prosegur recovered yesterday to forced marches both corporate and burstile prominence. The agreement reached with Telefnica to jointly develop the alarm business in Spain is a boost for the digital transformation of Prosegur's activity.

Investors yesterday granted a burst push to the security services company. The increases exceeded double digits at times, and at the close they reached 9.91%, up to 3.79 euros per share. Thanks to this rally, the company reduced accumulated losses on the stock market to 12% so far this year.

The agreement signed with Telefnica also triggers optimism among investment firms, and if the new forecasts of Deutsche Bank, Prosegur will virtually erase all losses suffered in 2019.

The German investment firm has reacted to the agreement with Telefnica in the alarm business in Spain with an 18% improvement in its valuation. The target price increases from 3.60 euros per previous share to 4.5 euros.

The overwhelming improvement in Deutsche Bank's prospects now leaves room for additional double-digit increases of 12% in the Prosegur price compared to yesterday's close.

The current optimism of Deutsche Bank on Prosegur moves away from the pessimism transferred only four months ago, when the analysts of the German firm advised to 'sell' shares of the company listed on the Continuous Market, with a valuation of 3.80 euros.

The new Deutsche Bank target price is still below the market consensus. The group of analysts compiled by Reuters put the average valuation of Prosegur at 5.17 euros per share, 30% above its current price.

Prosegur's bullish pull yesterday has placed its capitalization significantly above that of its subsidiary Prosegur Cash, exceeding 2,200 million euros compared to 2,000 million of its subsidiary.