Essity (Hold, TP: SEK300.00) - Pricing discipline in focus again
With falling raw-material costs, focus now turns to Essity’s ability to maintain positive pricing momentum. Q4 YOY other-cost comparables are tough though (report due 07:00 CET on 22 January), and we have cut our 2019–2022e EPS by 1–2% given less favourable FX, but we expect pricing discipline will be maintained. The shares are in neutral valuation territory, thus we reiterate our HOLD but have lifted our target price to SEK300 (290) after moving our valuation base to 2022e.
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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