AAK (Buy, TP: SEK175.00) - Margin headwind set to turn in 2023
The strong Q3 results and positive working-capital outlook for H1 2023e support our view of higher gross margins into next year as well as better profitability. AAK appears well on its way to delivering on its >10% EBIT growth ambition with c22% growth YTD. We reiterate our BUY and have raised our target price to SEK175 (167) on our higher estimates.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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