Orange Earnings: Results in Line With Guidance; Completes Spanish Merger

Although no-moat Orange's results were aligned with consensus estimates, shares declined by 4% during the trading session. Revenue of EUR 9.85 billion and EBITDAaL of EUR 2.41 billion (excluding Spain) grew by 2.1% and 2.3% organically, respectively, both aided by double-digit growth in Africa. This is in line with Orange’s guidance for 2024, which is set at low-single-digit growth in EBITDAaL. We are maintaining our EUR 13.40 fair value estimate. We believe Orange is faring well in general, making modest increases to its dividend, reducing capital intensity, and keeping financial leverage in check.