Arjo (Buy, TP: SEK70.00) - Full-year guidance at risk
We believe Q3 organic growth was in line with Q2 and thus expect rather flat sales in Q3, implying a risk that the full-year guidance of 3–5% organic growth might prove optimistic. However, we believe the market has probably priced in much of this already (the shares are down 64% YTD). We still like the long-term story and reiterate our BUY but have cut our target price to SEK70 (90).Co. is the parent company of a group engaged in the development, manufacture, marketing, and sale of hygiene systems and patient handling equipment. Co.'s operations are divided into three divisions. The Hygiene Systems division is engaged in the manufacture of bathing systems, sit-baths, shower cabinets, shower trolleys, and integrating hygiene lifters. The Patient-Handling Products division is engaged in the manufacture of equipment for lifting and transferring elderly and disabled people. The Other Products division is engaged in the provision of installation and maintenance service; the sale of spare parts; and the production of therapy tanks, pool lifts, hydrotherapy pools, bath oils, shampoos, and disinfecting agents.
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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