Bergman & Beving (Buy, TP: SEK100.00) - Strong signs of resilience
The Q1 2020/21 results showed greater resilience than we expected, with gross margin pressure offset by efficiency gains, and EBITA ~67% above our forecast. We still expect a significant FX headwind in 2020/21, but now see this balanced by price increases, with the underlying operation well managed and generating strong FCF. The resumption of dividends, strong financials allowing for further acquisitions, and solid insider support mean we reiterate our BUY, with a raised SEK100 (85) target price.B&B Tools AB provides the industrial and construction sectors in northern Europe with industrial consumables, industrial components and related services. Co. has four business areas, Luna (Tools & Machinery), Skydda (Personal Protective Equipment), Essve (Fastening Elements) and Gigant & Grunda (Work Environment & Consumables), which supply TOOLS and other market channels with industrial consumables and related services. TOOLS is Co.'s market channel for industrial consumables and industrial components for Nordic industry. Via TOOLS, Co. has operation in Sweden, Norway and Finland.
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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