Most expensive among peers, but still cheap

Small Cap Miner – August 2024

2020 Bulkers (Sell, TP: NOK118.00) - Premium exposure, downside risk

2020 Bulkers continues to offer premium dry bulk exposure, with an 18% run-rate yield on July DPS. However, the company’s pricing remains closely tied to its NAV, which is underpinned by asset values at 15-year highs that are not supported by current freight markets. Hence, we believe risk is largely skewed to the downside, with asset values most likely to converge lower, reflecting what we view as a fragile situation ahead. We reiterate our SELL and have cut our target price to NOK118 (149).

Scandic Hotels (Buy, TP: SEK80.00) - Building a dividend case

After its strong share price performance (+82% LTM), the Q3 report, Q4 outlook and updated financial targets were not the short-term catalysts we were looking for to take the investment case to the next level. The high proposed DPS and buybacks are supportive, and we see unutilised ‘financial muscle’ for the future. We still like the group’s leading Nordic footprint, operating profile and FCF capacity, and reiterate our BUY and SEK80 target price.

Valmet (Buy, TP: EUR32.00) - Earnings growth needed in Q4

Following mixed Q3 results, we have tweaked our 2024–2026e clean EPS (c-1% on average). Q3 clean EBITA improved slightly YOY, but we believe a stronger improvement will be required in Q4 YOY to reach the 2024 guidance of flat clean EBITA YOY. We reiterate our BUY and EUR32 target price.

Elopak (Hold, TP: NOK45.00) - Uneventful Q3

Q3 EBITDA of EUR45m was in line with our estimate and consensus, but EPS of EUR0.06 disappointed due to higher-than-expected losses on financial instruments. We have edged up our 2025–2026e EPS by 1–2%, based on improved visibility on volume assumptions in the Americas. We forecast Q4 EBITDA of EUR47m and reiterate our HOLD and raise our target price to NOK45 (44).