Hexpol (Buy, TP: SEK96.00) - Better than expected
After the weak gross margin in Q4 (on an unfavourable mix) and recent macro turmoil, the pressure was on for Hexpol’s results to improve, and Q1 was somewhat above our expectations and consensus despite continued negative product mix. Management has not (yet) seen raised raw material prices in the US from tariffs, but historically Hexpol has always passed on price increases. Our adj. 2025–2027e EBITA is broadly unchanged, and we reiterate our BUY and SEK96 target price.Hexpol is organized in two business areas: HEXPOL Compounding and HEXPOL Engineered Products. HEXPOL Compounding is engaged as a supplier in the development and manufacture of polymer compounds. HEXPOL Compounding focuses primarily on two key segments of the polymer market: rubber compounding and thermoplastic elastomer compounding. HEXPOL Engineered Products is engaged as a supplier of products such as gaskets for plate heat exchangers and wheels for the forklift industry. The business area also provides rubber profiles, mainly for the construction and engineering industries.
DNB Markets is the investment banking arm of DNB Bank ASA and is focused primarily on the Nordic region, as well as internationally on niches such as global shipping, energy and related services, and seafood. DNB Markets offers services in FICC, Equities and Investment Banking advisory from offices in Oslo, Stockholm, London, Singapore and New York. Equity research coverage is offered on c250 Nordic companies. DNB was ranked no.2 in Extel Nordic Research 2017. The DNB Markets’ Credit and FICC Macro & FX Research teams are repeatedly highly rated by Prospera Nordic Institutional Investor Surveys.
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