Apr. 4 at 3:00 AM
$SLVYY OK, so if you paid
$4.20/shr for this ADR on the initial Einhorn pop, that's unfortunate. But here's the [Mr.] bright side. Solvay is expected to generate roughly €3/shr of FCF in 2024 and growing to €5/shr FCF in 2026+ as end-markets recover and cost efficiencies flow through. Just so happens that commodity chemical bellwether DOW is expected to earn
$3/shr in 2024 and
$5/shr in 2026. Now
$SOLB.BB closed at €26.69/shr in Europe before the Einhorn presentation. Guess where US-listed DOW trades...
$60/shr!!! I won't even mention that Solvay has higher margins and less earnings volatility than DOW. So in theory, no reason SOLB.BB can't trade into the €50+/shr range (
$5.40+/shr on the ADR). That's why Einhorn mentioned that Solvay "at twice the price it wouldn't seem expensive." This of course is another example of why a global company like Solvay should relist in the US (you heard it here first). So as Wilson Phillips sings, "Hold On."