Essity (Hold, TP: SEK240.00) - Hitting the zenith of the challenge
With pulp prices reaching new highs, Essity faces the continued challenge of raw material headwinds not yet being fully offset by price rises while FX and energy costs are also set to weigh on Q3 results (due 07:00 CET on 29 October). However, the recently announced cSEK800m savings programme is set to have a small impact in Q4, along with a likely new round of price rises that could have a balancing effect in H1 2019. We reiterate our HOLD recommendation and SEK240 target price.
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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