DnB Markets - Bergman Beving (BERG B) Bergman Beving (Buy, TP: SEK165.00) - Much-improved FCF generation

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DnB Markets

Karl-Johan Bonnevier

EUR 478.99 For Business Accounts Only

Bergman & Beving (Buy, TP: SEK165.00) - Much-improved FCF generation

The Q1 report matched our expectations. We believe the much-improved FCF generation allows for a renewed acquisition focus (three deals YTD), partly offsetting weakening demand indicators and FX, leading us to do only minor 2023/24–2025/26e EPS cuts. We see potential in the CEO’s ‘focus-model’ approach and ambition to grow EBIT to SEK500m by 2025/26, highlighting possible value-creation from internal efficiency and acquisitions, similar to our value gap analysis. We reiterate our BUY and SEK165 target price.

17/07/2023 1 EN

Underlying

Bergman & Beving

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.

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SE0000101362 Nasdaq Nordic Stockholm Sweden

Provider

DnB Markets

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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Analysts

Karl-Johan Bonnevier

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Bergman & Beving (Buy, TP: SEK165.00) - Much-improved FCF generation

Bergman & Beving AB: 1 director

Bergman & Beving (Hold, TP: SEK315.00) - Uncharted valuation territory

Bergman & Beving (Hold, TP: SEK250.00) - Down to HOLD after revaluation

Edda Wind (Buy, TP: NOK30.00) - Well positioned

Valuation and market update

Petrobras FPSO delays may hit service volumes but lengthen cycle

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