Essity (Hold, TP: SEK295.00) - Normalising after high volatility
Essity’s Q2, released early, was in line with consensus expectations, but with high underlying volatility across regions and categories – a strong Consumer Tissue (Vinda-related) was offset by weakness in Professional Hygiene and Medical Solutions. We find Essity in neutral-to-negative absolute and relative valuation territory, with much-improved FCF generation limiting the downside risk. Hence, we have upgraded to HOLD (SELL) with a new target price of SEK295 (290).
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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