Axactor (Buy, TP: NOK50.00) - Earnings set to pick up
We forecast Q4 net profit of EUR4.7m, driven by a 60% QoQ growth in gross collections. We estimate EUR323m in portfolio investments in Q4, based on comments from Axactor that it deployed capex of ~EUR550m in all of 2018. Axactor signed several larger forward flow deals in Q4, which we expect to generate quarterly capex of EUR60m–75m going forward. We have made only minimal changes to our 2019–2020e EPS, and find the stock attractively valued at a 2020e EV/EBIT of 8.6x and a 2020e P/E of 4.2x. We reiterate our NOK50 target price and BUY recommendation.
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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