Citycon (Hold, TP: EUR3.75) - Balance sheet needs strengthening
The Q3 results were broadly in line with our forecasts. Citycon narrowed its 2024 guidance, and we estimate EPS just below its 0.47-0.49 EUR per share outlook Despite maintaining its quarterly DPS, we still believe the balance sheet needs to improve. The strategy appears to be deleveraging with assets sales; we expect ‘crown jewels’ to be sold. However, we find this largely reflected in the current NAV discount, and have upgraded to HOLD (SELL) and maintained our target price of EUR3.75.Citycon is an active owner, operator and developer of shopping centers. Co. aims to increase its net yield from shopping centers over the long term through active retail property management and systematic redevelopment efforts. Co. is involved in the day-to-day operations of its shopping centers. As of Dec. 31, 2011, Co. owned a total of 36 shoppings centers: 23 in Finland, 9 in Sweden, 3 in Estonia, and one in Lithuania. Co. also owns 43 other retail properties: 36 in Finland and 7 in Sweden and one undeveloped lot in Finland. Co. manages two commercial shopping centers in 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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