Assa Abloy (Sell, TP: SEK190.00) - Time to take profit
We have downgraded Assa Abloy from HOLD to SELL and lowered our target price to SEK190 (200). We expect organic growth to slow considerably from Q2 and do not believe the company will fulfil its ambition to get the EBIT margin up to 16–17% in 2019. The shares have risen by >30% YTD (8%-points above the OMXS30), leaving the valuation stretched at a 2019e EV/EBIT of 18x, with poor risk/reward in our view.
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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