Fortnox (Buy, TP: SEK83.00) - Q3 reinforced our scalability thesis
Fortnox continues to execute well in a tough market, with adj. EPS of 34% and adj. FCF growth of 104% YOY, demonstrating the business model’s resilience and scalability. The deconsolidation of Offerta should trigger an organic sales growth acceleration in Q4e at higher margins, while encouraging KPIs for the business card and payments offering show incremental potential for 2025e. Since 2021, the stock has been roughly flat, as it has grown into its valuation multiples (~50% multiples contraction). At this point, the TSR potential should represent our 2024–2026e EPS of 35%, FCF CAGR of 45%, and ROIC of 40%+. We reiterate our BUY and have raised our target price to SEK83 (82).
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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