Demant (Buy, TP: DKK415.00) - Pent-up demand to support growth
We believe investor focus will be less on H2 results and more on the 2022 guidance. We expect organic revenue guidance of 6–10% YOY in local currency and EBIT before special items of DKK3,600m–3,900m. The release of pent-up demand should support short-term growth, and we find it unlikely that lost revenues on cochlear implants will have a severe impact on total group revenues. We reiterate our BUY and target price of DKK415. Solid growth in Hearing Devices. We forecast H2 revenues of DKK9,549m (local currency growth of 13.8% YOY), driven by a strong performance in wholesale, retail and Diagnostics, while Hearing Implants and EPOS remain a drag on the group performance. Oticon Medical has identified the technical error with its Neuro Zti cochlear implants as being related to the manufacturing process, with sales activities set to be resumed in Q3 2022eWilliam Demant Holding is a holding company. Through its subsidiaries, Co develops, manufactures and sells products and equipment designed to aid the hearing and communication of individuals. Co. focuses on four areas: Hearing Devices, Diagnostic Instruments, Hearing Implants and Personal Communication. Co.'s hearing devices include Oticon, Bernafon, Sonic, Phonic Ear, and FrontRow. Co.'s Hearing implant consist of Oticon Medical. Co.'s diagnostic instruments include Maico, Interacoustics, Amplivox, Grason-Stadler, MedRx, and Micromedical. Co.'s personal communication consists of Sennheiser Communications.
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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