| Valuation method | Value, £ | Upside, % |
|---|---|---|
| Artificial intelligence (AI) | 20.20 | 44 |
| Intrinsic value (DCF) | 5.36 | -62 |
| Graham-Dodd Method | 7.60 | -46 |
| Graham Formula | 8.30 | -41 |
Miquel y Costas & Miquel, S.A. (MYC) is a Spain-based industrial materials company specializing in the production and sale of fine and specialty lightweight papers. Founded in 1725 and headquartered in Barcelona, MYC operates across three key segments: Tobacco Industry, Industrial Products, and Others. The company serves global markets with high-quality papers for cigarette manufacturing, printing, rolling, and specialty applications, as well as textile pulps and colored cardboards. MYC also engages in paper pulp manufacturing, logistics, and energy production through its thermal electric plant. With a strong export presence, MYC leverages its long-standing expertise to maintain a competitive edge in the niche lightweight paper market. As a leader in sustainable paper solutions, the company aligns with growing demand for eco-friendly industrial materials, reinforcing its relevance in the Basic Materials sector.
Miquel y Costas & Miquel presents a stable investment opportunity with its niche focus on specialty papers and a low beta (0.436), indicating lower volatility relative to the market. The company reported solid FY2023 financials, including €309.17M in revenue and €48.7M net income, with a healthy operating cash flow of €67.94M. Its dividend yield (~1.5% based on a €0.38145/share payout) adds income appeal. However, risks include exposure to the declining tobacco industry (a key revenue driver) and reliance on industrial demand cycles. MYC’s modest debt (€55.43M vs. €13.34M cash) and consistent profitability suggest resilience, but investors should monitor raw material cost pressures and ESG trends affecting paper demand.
Miquel y Costas & Miquel’s competitive advantage lies in its specialization in lightweight and specialty papers, particularly for the tobacco industry, where it has deep technical expertise and long-term client relationships. Its vertically integrated operations—from pulp production to distribution—enhance cost control and supply chain reliability. The company’s focus on high-margin niche segments (e.g., cigarette papers) differentiates it from broader paper manufacturers. However, MYC faces competition from larger global players with greater scale and diversification. Its reliance on the tobacco sector (~50% of revenue) is a vulnerability as smoking rates decline in developed markets. MYC’s smaller size limits R&D spending compared to giants like Mondi or International Paper, but its agility in serving customized paper solutions for industrial clients provides a regional edge in Europe. Sustainability initiatives, such as eco-friendly pulps, could bolster its positioning amid regulatory shifts toward greener materials.