AAK (Buy, TP: SEK167.00) - No sign of headwinds easing – yet
We are largely in line with consensus for Q3e (results due at 08:30 CET on 25 October). Following a change of analyst, we have cut our target price to SEK167 (247) on lowered estimates and a new valuation methodology, while we reiterate our BUY, with the stock down c30% from its November 2021 peak and now trading at a discount to historical multiples. Furthermore, we see support for gross margins next year and in turn profitability from raw material prices trending down.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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