Archer (Buy, TP: NOK45.00) - Set for QOQ improvement in Q2
We expect a sequentially improved performance in Q2 and forecast EBITDA of USD36m, 7% above consensus. However, the timing of payments for previously announced acquisitions is likely to hit cash flow together with contract-specific capex, and we see net debt rising from USD386m to USD395m, but cash flow improving in H2 and 2025. We have raised our 2025e EBITDA by 2% to reflect recent M&A, and are 3% above consensus. The stock is one of the most attractively valued in our sector coverage, with a 2025e EV/EBITDA of 3.1x and FCF to EV of 18%. We reiterate our BUY and NOK45 target price.
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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