Analysts revise recommendations on the shares of Yandex due to new sanctions

Photo: Oleg Yakovlev / RBC

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“VTB Capital” has placed on review shares of Yandex N. V. and retained in the revision of the action Mail.Ru Group because of the need assessment of the effects of sanctions from the Ukraine. While analysts believe that the sanctions only limit the possibility of expansion of Russian Internet companies

As stated in received by RBC analyst report, “VTB Capital”, introduced by Ukraine sanctions on Yandex (owned by Yandex N. V.) and Mail.Ru Group, likely to have “a limited impact” on the financial performance of these companies.

“We believe that the prospects of advertising revenue for Yahoo and Mail.Ru Group is primarily dependent on Russian advertising market, which still continues to grow rapidly (by 23% in the first quarter, according to preliminary data of the IAB Russia)”, — the report says “VTB Capital”. Revenues from the segment of multiplayer games Mail.Ru Group depend on the ability of the company to monetize this area. At the same time, “VTB Capital” stipulates that restrictions on the Ukrainian market with an online audience of more than 20 million users mean for both companies, “the loss of one of the natural directions of expansion outside Russia”.

In connection with the need to assess potential impact on value of securities of “VTB Capital” has placed on review the shares of Yandex and retained in the revision of the action Mail.Ru Group. Until now, the recommendation of “VTB Capital” for the shares of Yandex was “hold”, which corresponds to the expected total income (the difference between target and final price based on the dividend yield over the next 12 months) in the amount of from 0 to 20%.

May 16 the President of Ukraine Petro Poroshenko issued a decree on the application against a number of legal entities and individuals “personal special economic and other restrictive measures.” Sanctions imposed on 468 Russian and Ukrainian companies and individuals. In 1228, the list including services Mail.Ru Group (including the page Mail.ru owned by the holding company and the popular social network “Vkontakte” and “Classmates”) and “Yandex” — from a news aggregator (news.yandex.ru) to transfer service “Yandex.Taxi”. “I urge all compatriots to immediately leave the Russian servers because of security reasons,” said on their pages in “Schoolmates” and “Vkontakte” the President of Ukraine before they are closed.

Earlier Mail.Ru Group and “Yandex” has made a statement, which said that sanctions will not have an impact on their financial performance, but a negative impact on the users. Services Mail.Ru used by about 25 million, and “Yandex” — the 11 million inhabitants of Ukraine, reported by these companies.

At the end of trading on may 16 on the American NASDAQ securities Yandex cost $of 28.99, paper Mail.Ru Group on the London stock exchange — $27.

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