Flex LNG Minor model adjustments

We have updated our estimates for the Q2 results, updated guidance, and announced refinancing. We still see an attractive 2024–2026e dividend yield at 12%, supported by its solid contract backlog mitigating near- to medium-term market risk. We also see upside potential to our average 2024–2026e fleet-wide TCE of cUSD80k/day, with 5-year TC rates currently quoted at close to USD100k/day. We do not consider our estimate changes to be material, and we have not changed our BUY recommendation. We reiterate our NOK355 target price.

More upside than downside, but still a HOLD

Q2 much as guided, special dividend in H2'24?

EBITDA of USD 63m (ABGSC and cons at 66m). Q3'24 guidance slightly below expectations. Flat share price reaction.

Lyko Group (Sell, TP: SEK95.00) - Waiting for further positive signs

For Q3, we are slightly above consensus on EBIT but below on net profit. We expect Lyko’s results to be weighed down by continuously high financial costs. In our view, focus will remain on its European market, the efforts to improve its group gross margin, and the cash flow position (net debt/EBITDA of c4.4x at end-Q2). We reiterate our SELL and SEK95 target price, reflecting its stretched balance sheet and our belief that it will take time to properly balance growth and profitability.

The weekly navigator

From the past week, we highlight: 1) we hosted investor lunches with the CEOs of Svolder and Byggmästaren at our Stockholm office; 2) we met with Investor, which is continuing to execute on its M&A agenda; 3) we met with VEF, which is seeing positive momentum for fintech VCs in its core markets of Brazil and India.

Bilia AB (Buy, TP: SEK150.00) - Recovery likely pushed to 2025

We are cautious ahead of the Q3 report, as a likely recovery in car earnings is pushed to 2025e, while we expect service earnings to be flattish on still-restrained consumer sentiment near-term. Nevertheless, with c+40% EPS growth in 2025e on a forecast new-car market recovery next year, we remain positive on the stock. We reiterate our BUY but have cut our target price to SEK150 (160), mainly on lower estimates.