Renewable Weekly – 28 Nov 2024

On aggregate, the R&C stocks underperformed (equal weight) the MSCI Nordic by ~4% throughout the reporting season (15 October to today).

Ørsted (Hold, TP: DKK390.00) - Balance sheet risk still in focus

Ørsted reported underlying results on the downside and further construction issues in the US. The reversal of cancellation fees and deferred capex helps near-term liquidity, but we still believe significant asset sales are needed to fix its balance sheet. We reiterate our DKK390 target price and have upgraded the stock to HOLD (SELL), as it is valued on a par with existing business and visible growth. However, we see uncertainty in the US and a weak balance sheet to continue to weigh on the stock.

Renewable Weekly – 11 November 2024

Electrolux Professional (Hold, TP: SEK75.00) - Q4 looks set to be a repeat of Q3

We expect broadly similar market and divisional dynamics QOQ in Q4, but are less optimistic on growth in the US Food & Beverage segment (we now see the recovery materialising slightly later than initially envisaged). We forecast 6.0% growth YOY in group sales in Q4 and an adj. EBITA margin of 12.3%. We reiterate our HOLD, but have lowered our target price to SEK75 (79) based on our view of a delayed US Food & Beverage recovery as well as continued headwinds in the Middle East into 2025.

Electrolux (Hold, TP: SEK92.00) - Uncertainty remains high

In Q4, we forecast similar demand and market dynamics to Q3, with consumer downtrading, elevated promotional activity, a negative mix, price pressure, and weak consumer demand weighing on sales and EBIT. We expect a sales decline of 1.6% YOY (organic growth of 2.6%) and an adj. EBIT margin of 3.2%. We reiterate our HOLD, but have cut our target price to SEK92 (94).

Novo Nordisk (Buy, TP: DKK1040.00) - Disappointing CagriSema data

In REDEFINE-1, CagriSema reached a 22.7% product estimand weight loss, shy of expectations. We expect a launch in 2026, but have lowered our estimate of its sales potential. In our view, the flexible protocol affected efficacy, prompting Novo Nordisk to initiate a new phase III trial in 2025. We reiterate our BUY, but have cut our target price to DKK1,040 (1,150).