AAK (Buy, TP: SEK235.00) - Continued strong recovery in Q3e
We expect a 16.5% increase in Q3 sales YOY and an adj. EBIT margin of 7.9%, owing to a strong recovery from Covid-19 headwinds and easy comparables. We believe the recovery seen in Q2 should continue in H2, driving an improved financial performance, supported by a shift in the portfolio mix. We have raised our target price to SEK235 (233) and reiterate our BUY. We see scope for higher multiples given the outlook, as the stock is trading at a 12-month forward P/E of 24.8x.AAK is a producer of high-value added vegetable oils and fats. Co. operates in three business segments: food ingredients, chocolate and confectionery and technical products and feed.
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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