Live Markets: SMIDs: watch out for more Italian delistings
07/05/2024 11:00
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SMIDS: WATCH OUT FOR MORE ITALIAN DELISTINGS
Small- and mid-caps (SMIDs) have been laggards in markets
increasingly dominated by megacap stocks and even though
investors have been anticipating a possible recovery for months,
this so far has proven to be rather elusive.
Yet things might get more interesting going forward.
Massimo Trabattoni, head of Italian equity at Kairos, notes
that several mid-caps have seen take-private offers in Italy in
recent weks and believes this is a trend that could gain steam
and broaden to micro stocks once interest rates start to fall.
He mentioned takeover bids for navigation systems maker
Civitanavi CNS.MI , snack and drinks machine vendor IVS Group
IVS.MI and railway maintenance company Salcef SCFG.MI .
"The companies destined for delisting are generally among
the highest quality ones. This means that those who wish to
continue investing in listed mid and small caps, an even more
rigorous stock-picking will be necessary," Trabattoni said.
As you can see in the chart, Europe's small .SCXP and
mid-cap .MCXP stocks have risen 4.7% and 8.7% over the past
two years. That compares to a near 21% surge for large caps
.LCXP .
(Danilo Masoni)
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