Aeroports de Paris SA (ADP.PA) | Investment Case

1. Company Snapshot

1.a. Company Description

Aeroports de Paris SA owns and operates airports worldwide.The company operates through Aviation, Retail and Services, Real Estate, International and Airport Developments, and Other Activities segments.The Aviation segment offers security and airport safety services, such as security checkpoints, screening systems, aircraft rescue, and fire-fighting services.

The Retail and Services segment provides retail activities comprising of bars, restaurants, banks, car rentals, and retails shops, as well as engages in leasing of space for terminals, advertising, restaurant, and car park services.This segment is also involved in production and supply of heat, drinking water, and access to the chilled distribution networks.The Real Estate segment engages in construction, commercialization, and lease management of office, logistic buildings, and freight terminals; and provides property leasing services for airport terminals, as well as rents serviced land.

The International and Airport Developments segment designs and operates airport activities.The Other Activities segment offers telecom and cybersecurity services.It operates and manages approximately 28 airports worldwide.

Aeroports de Paris SA was incorporated in 1945 and is based in Tremblay-en-France, France.

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1.b. Last Insights on ADP

Aeroports de Paris SA faced challenges due to rising operational costs and intense competition. Despite a better-than-expected third-quarter revenue, concerns linger. The company's growth was largely driven by passenger traffic recovery, however, Groupe ADP's recent earnings release showed a significant increase in operating expenses. According to Investing.com, the company's revenue growth was overshadowed by rising costs. Additionally, regulatory pressures and potential changes in air travel policies may impact the company's future growth trajectory.

1.c. Company Highlights

Last Price	118.6
Change Percentage	-1.50%
Open	120.2
Previous Close	120.4
Market Cap ( Millions)	11710
Volume	105450
Year High	133.9
Year Low	89.5
M A 50	114.37
M A 200	114.66

FCF Yield	2.93%
Dividend Yield	2.53%
ROE	9.06%
Debt / Equity	243.60%
Net Debt / EBIDTA	471.27%
Price To Book	2.69
Price Earnings Ratio	30.72
Price To FCF	34.14
Price To sales	1.75
EV / EBITDA	11.06

2. Group ADP's 2025 Results: Solid Performance Amidst Challenges

Group ADP reported a revenue of EUR 6.7 billion for 2025, representing a 9% year-over-year increase, driven by strong operating performance across its segments. EBITDA grew by 12% to a significant level, showcasing the company's ability to execute disciplined cost management. However, the actual EPS came out at '2.88', slightly below estimates of '3.2', indicating some pressure on the bottom line. The company's financial performance was highlighted by Christelle de Robillard, Executive VP for Finance, Strategy and Development, who noted the continued solid traffic growth, with TAV Airports delivering a 6% traffic increase and GMR Airports showing 3% growth.

Publication Date: Feb -20

                                    📋 Highlights
                                    Revenue and EBITDA Growth:
                                                Revenue reached EUR 6.7 billion (+9% YoY), EBITDA rose 12% to EUR 2.35 billion.
Employee Shareholding Success:
                                                75% employee participation secured, representing nearly 2% of the company's capital.
Airport Traffic Performance:
                                                TAV Airports grew 6% in traffic, GMR Airports rose 3%, despite retail challenges.
2026 Financial Guidance:
                                                EBITDA target exceeds EUR 2.35 billion; CapEx investment of EUR 1.45 billion planned.
Regulatory Agreement Progress:
                                                2027-2034 ERA proposal gains airline and state support, focusing on fair investment remuneration.

                                

Segmental Performance

The company's airport segments demonstrated varying degrees of success, with TAV Airports leading the way with a 6% traffic increase. Retail trends were affected by internal and external factors, but the company remains confident in the Extime model, which drove higher-margin categories like beauty. The retail performance outperformed despite SPP headwinds, due to solid cost discipline and cautious stock management and purchasing policy.

Outlook and Guidance

For 2026, Group ADP expects EBITDA growth to be driven by international assets, particularly TAV, with a group-level EBITDA target of above EUR 2.35 billion. The company will continue to invest around EUR 1.45 billion at the group level, with a gradual increase in capital expenditures compared to 2025. Analysts estimate next year's revenue growth at 4.7%, indicating a moderate pace of expansion.

Valuation Metrics

With a P/E Ratio of 30.9 and an EV/EBITDA of 11.1, the market appears to be pricing in a certain level of growth and profitability for Group ADP. The company's ROE stands at 9.06%, indicating a reasonable return on equity. The Net Debt / EBITDA ratio of 4.71 suggests a relatively high level of indebtedness, which may be a concern for investors.

Economic Regulation Agreement (ERA)

Philippe Pascal emphasized the importance of the ERA proposal for 2027-2034, which is designed to secure a fair remuneration of investments. The company has the support of airlines and the French State, and the regulator has stated that the ERA is the right framework to address structural topics. The company is confident that the ERA will provide a stable regulatory environment, enabling it to deliver on its strategic priorities.

Strategic Priorities

The company's strategic priorities for 2026 include economic regulation elaboration, cultural transformation, corporate social responsibility, and portfolio review. The company is committed to delivering a good agreement, ensuring fair remuneration of investment, and is prepared to accept a minimum WACC to deploy the CapEx plan for the ERA. The portfolio review is aimed at clarifying long-term value drivers and the strategic role of each asset, without triggering a major disposal.

3. NewsRoom

Groupe ADP third-quarter revenue exceeds consensus estimates

Oct -24

Source:

Assessing Aeroports de Paris (ENXTPA:ADP) Valuation as Markets Pause for Direction

Sep -11

Source:

Aéroports de Paris posts revenue rise on passenger growth and steady retail spend

Jul -30

Source:

Aéroports de Paris stock falls after mixed 2Q results

Jul -30

Source:

Are You Splurging on Food and Drink Before Departure? Your Airport Really Hopes So

Mar -04

Source:

Aeroports de Paris SA (AEOXF) (FY 2024) Earnings Call Highlights: Strong Financial Performance ...

Feb -25

Source:

Aeroports de Paris SA (AEOXF): Among the Best Airport Stocks to Invest in Now

Feb -17

Source:

Is Aeroports de Paris SA (AEOXF) One of the Worst Airport Stocks to Buy?

Sep -30

Source:

4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (5.67%)

6. Segments

Aviation

Expected Growth: 5.5%

Aeroports de Paris SA's 5.5% growth in Aviation is driven by increasing air travel demand, fueled by a strong economy and rising tourism. Additionally, the company's strategic investments in airport infrastructure, improved air traffic management, and enhanced passenger experience contribute to the growth. Furthermore, the rise of low-cost carriers and the growth of cargo traffic also support the segment's expansion.

International and Airport Development - TAV Airports

Expected Growth: 6.2%

TAV Airports' 6.2% growth driven by increasing air travel demand, strategic airport acquisitions, and expansion into high-growth markets. Strong partnerships with airlines, efficient operations, and investments in digitalization and sustainability initiatives also contribute to growth. Additionally, the company's diversified revenue streams, including aeronautical and non-aeronautical services, provide a solid foundation for continued expansion.

Retail and Services - Extime Duty Free Paris (Ex SDA)

Expected Growth: 5.8%

Strong tourism growth in Paris, driven by increased travel from Asia and the Middle East, coupled with Aeroports de Paris SA's successful marketing strategies and investments in enhancing the travel experience, have contributed to the 5.8% growth in Extime Duty Free Paris (Ex SDA) retail and services segment.

Retail and Services

Expected Growth: 5.5%

Aeroports de Paris SA's Retail and Services segment growth of 5.5% is driven by increasing passenger traffic, expansion of retail space, and strategic partnerships. Growing demand for travel retail, particularly in luxury and duty-free segments, also contributes to growth. Additionally, investments in digitalization and omnichannel experiences enhance customer engagement, driving sales and revenue.

International and Airport Development - Airport International Group PSC

Expected Growth: 6.0%

Airport International Group's 6.0% growth is driven by increasing air travel demand, strategic partnerships, and expansion into new markets. Additionally, investments in airport infrastructure, technology, and services enhance passenger experience, attracting more airlines and passengers. The acquisition by Aeroports de Paris SA brings expertise and resources, further fueling growth.

Real Estate

Expected Growth: 4.8%

Aeroports de Paris SA's Real Estate segment growth of 4.8% is driven by increasing passenger traffic, airport expansion projects, and strategic partnerships. Growing demand for air travel and cargo transportation fuels rental income from airport facilities. Additionally, the company's diversification into commercial real estate, such as office and retail spaces, contributes to the segment's growth.

Other

Expected Growth: 4.2%

Aeroports de Paris SA's 4.2% growth is driven by increasing passenger traffic, driven by tourism and business travel, as well as growth in air cargo. Additionally, the company's focus on improving airport infrastructure and services, such as retail and dining, contributes to revenue growth.

Retail and Services - Relay@ADP

Expected Growth: 5.3%

Relay@ADP's 5.3% growth in Retail and Services is driven by increasing passenger traffic, strategic partnerships, and expansion of its retail network. Additionally, investments in digital transformation and enhanced customer experience have contributed to the segment's growth.

International and Airport Developments

Expected Growth: 5.9%

Aeroports de Paris SA's 5.9% growth in International and Airport Developments is driven by increasing air travel demand, strategic partnerships, and investments in airport infrastructure. Additionally, the company's expansion into emerging markets, diversification of revenue streams, and focus on sustainability initiatives contribute to its growth momentum.

7. Detailed Products

Airport Operations

Management of airport infrastructure, including air traffic control, baggage handling, and security services.

Retail and Services

Management of retail spaces, including shops, restaurants, and bars, as well as provision of services such as parking, car rentals, and hotel reservations.

Real Estate

Management of airport real estate, including office space, logistics facilities, and land development.

Airport Security

Provision of security services, including passenger screening, baggage screening, and access control.

Airport Maintenance

Provision of maintenance services, including airfield maintenance, building maintenance, and utility management.

Airport Development

Development of airport infrastructure, including terminal expansions, runway renovations, and other capital projects.

8. Aeroports de Paris SA's Porter Forces

Forces Ranking

Threat Of Substitutes

The threat of substitutes for Aeroports de Paris SA is medium due to the presence of alternative modes of transportation such as trains and buses, but the convenience and time-saving aspect of air travel reduces the likelihood of substitution.

Bargaining Power Of Customers

The bargaining power of customers for Aeroports de Paris SA is low due to the lack of alternative airports in the Paris region, giving the company a strong negotiating position.

Bargaining Power Of Suppliers

The bargaining power of suppliers for Aeroports de Paris SA is medium due to the presence of multiple suppliers for goods and services, but the company's large scale of operations gives it some negotiating power.

Threat Of New Entrants

The threat of new entrants for Aeroports de Paris SA is low due to the high barriers to entry in the airport industry, including the need for significant capital investment and regulatory approvals.

Intensity Of Rivalry

The intensity of rivalry for Aeroports de Paris SA is high due to the presence of other major airports in Europe, such as Amsterdam Schiphol and Frankfurt Airport, which compete for air traffic and airline customers.

9. SWOT Analysis

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

	Value
Debt Weight	70.42%
Debt Cost	10.43%
Equity Weight	29.58%
Equity Cost	10.43%
WACC	10.43%
Leverage	238.07%

11. Quality Control: Aeroports de Paris SA passed 2 out of 9 key points

Strong Liquidity

Low Deb

Strong Interest Coverage

Healthy Cash Flow

Operating Inefficiency

Strong Return On Equity

Consistent Revenue Growth

Consistent Operating Cash Flow Growth

Margin Improvement

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

Lufthansa

A-Score: 5.3/10

Value: 8.3

Growth: 4.7

Quality: 3.3

Yield: 3.1

Momentum: 7.5

Volatility: 4.7

1-Year Total Return ->

Fraport

A-Score: 5.2/10

Value: 6.3

Growth: 6.3

Quality: 3.3

Yield: 0.0

Momentum: 8.5

Volatility: 7.0

1-Year Total Return ->

IAG

A-Score: 5.2/10

Value: 7.1

Growth: 4.8

Quality: 5.0

Yield: 1.9

Momentum: 8.0

Volatility: 4.7

1-Year Total Return ->

easyJet

A-Score: 4.9/10

Value: 8.5

Growth: 6.7

Quality: 4.2

Yield: 1.9

Momentum: 2.5

Volatility: 5.7

1-Year Total Return ->

Corporación América Airports

A-Score: 4.7/10

Value: 4.6

Growth: 6.9

Quality: 6.9

Yield: 0.0

Momentum: 7.0

Volatility: 2.7

1-Year Total Return ->

Aeroports de Paris

A-Score: 4.5/10

Value: 3.2

Growth: 5.9

Quality: 2.9

Yield: 2.5

Momentum: 6.0

Volatility: 6.7

1-Year Total Return ->

Peers Metrics

12.e Scoring ^Insights

12.f DCF ^BETA

Parameters

Short Term Growth

21.72%

Short term Time

10.0

Long-Term Growth

2.00%

WACC

10.43%

Aeroports de Paris SA - FR0010340141

1. Company Snapshot

1.a. Company Description

1.b. Last Insights on ADP

1.c. Company Highlights

Less Volatile

Stable Momentum

Fairly Valued

Medium Volatility

Average Growth

Average Yield

Revenues Beats

Earnings Beats

Average Quality

Weak Momentum

Earnings Miss

Lower Quality

2. Group ADP's 2025 Results: Solid Performance Amidst Challenges

Segmental Performance

Outlook and Guidance

Valuation Metrics

Economic Regulation Agreement (ERA)

Strategic Priorities

3. NewsRoom

4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (5.67%)

6. Segments

Aviation

Expected Growth: 5.5%

International and Airport Development - TAV Airports

Expected Growth: 6.2%

Retail and Services - Extime Duty Free Paris (Ex SDA)

Expected Growth: 5.8%

Retail and Services

Expected Growth: 5.5%

International and Airport Development - Airport International Group PSC

Expected Growth: 6.0%

Real Estate

Expected Growth: 4.8%

Other

Expected Growth: 4.2%

Retail and Services - Relay@ADP

Expected Growth: 5.3%

International and Airport Developments

Expected Growth: 5.9%

7. Detailed Products

Airport Operations

Retail and Services

Real Estate

Airport Security

Airport Maintenance

Airport Development

8. Aeroports de Paris SA's Porter Forces

Forces Ranking

Threat Of Substitutes

Bargaining Power Of Customers

Bargaining Power Of Suppliers

Threat Of New Entrants

Intensity Of Rivalry

9. SWOT Analysis

Strength

Weaknesses

Opportunities

Threats

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

11. Quality Control: Aeroports de Paris SA passed 2 out of 9 key points

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

Peers Metrics

12.e Scoring Insights

12.f DCF BETA

Parameters

Short Term Growth

12.e Scoring ^Insights

12.f DCF ^BETA