Axactor (Buy, TP: NOK10.50) - A challenging quarter
Q3 collections was hit hard by seasonality and soft collections, leaving gross revenues 7% below our estimate and 15% below company-compiled consensus. While the lack of investments is of less concern to us, we find the soft collections more of a challenge. As a result of this and new collection curves from the company, we have lowered our 2022–2023e EPS by 9–20%. In turn, we have cut our target price to NOK10.5 (12), but reiterate our BUY. While we acknowledge that a marked improvement in the operating performance is needed, the stock continues to look attractively valued at a ~37% discount to its 2021e book value.
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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