Better Q3 than initially expected... but not a true recovery Spanish Mid Caps'' results were better than expected overall, probably as a result of the conservatism of our and consensus estimates. Seven out of 18 companies reported better than expected figures with only two companies reporting worse than expected data. As in Q2, performance was not homogeneous. Some companies showed very resilient performance over the year (Ebro, Fluidra and Viscofan), others saw a recovery in Q3 as a result of the lift of the lockdowns (auto suppliers, CAF), while still others continue to suffer in the current environment as in the case of Tecnicas, and to a lesser extent, Almirall. Three big pieces of news: US elections, vaccines and Spanish budget law In the report we analyse the main impacts the recent US election results may have on our coverage. In addition, we consider the likely consequences of the news on COVID vaccines - our main winners are Rovi and Vidrala and our main losers are Ebro, Viscofan, Fluidra. Further, we analyse the new budget law in Spain, which being negative in general for all Spanish names, could have more negative consequences for those with higher business outside Spain (Tecnicas, CIE Automotive, Ebro, Prosegur Cash) as dividends repatriation for foreign subsidiaries could be taxed. Reporting on Spanish Midcaps and our model portfolio Despite the recent rally in the markets as a result of news on vaccines, the Spanish Mid Cap space continues to be in the red YTD (-2%). In terms of ratings we have become more cautious over the last six months, given the good rally of some names. We have 28% of ratings as Underperform and only 39% as Outperform, our most negative skew in two years. Our model portfolio, which includes Fluidra, Almirall, CAF and Logista, has seen +16% outperformance since September and +9% YTD. We maintain our top picks unchanged, although the upside is more limited in some of the names.