Bakkafrost (Sell, TP: NOK480.00) - 23% below Q3 consensus
We forecast Q3 operational EBIT of DKK186m, c23% below consensus of DKK241m (results due at 06:00 CET on 6 November). With the trading update revealing the lowest quarterly harvest volume since Q1 2011, we expect high fixed costs per kg. However, the price of larger fish held up better than the reference price in Q3, which should help the Farming margin, as Bakkafrost typically harvests larger fish. We have raised our target price to NOK480 (448), but we reiterate our SELL.
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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