Cargotec (Hold, TP: EUR41.00) - Strong H2 needed
We are 7% above consensus on Q3e adj. EBIT (results due at 14:00 EEST on 26 October). We believe the market is expecting Cargotec to cut its 2018 guidance, but also sees an attractive 2019–2020 valuation; in our opinion a strong H2 from Kalmar would pre-empt a guidance cut. In either case, we expect a positive share price reaction once the short-term uncertainty clears and market turns focus to 2019–2020e. We reiterate HOLD and our EUR41 target price.Cargotec is a provider of cargo handling solutions. Co. has three business areas: MacGregor, Kalmar and Hiab. MacGregor provides integrated cargo and load handling solutions and services for the maritime transportation and offshore industries. Kalmar offering consists of container and cargo handling equipment and related services, automation, software and integration solutions as well as Navis terminal operating systems, Bromma spreaders and Siwertell bulk handling systems. Hiab is a provider of on-road load handling equipment and services. Hiab provides products, services and spare parts that are used in on-road transport and delivery.
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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