GARO (Hold, TP: SEK26.00) - Recharging…please HOLD
We reiterate our HOLD, but have cut our target price to SEK26 (30) following the weak Q2 report. E-Mobility was again loss-making due to low sales, a weak gross margin and production redundancies, while Electrification was in line with our forecasts. With a net debt/EBITDA of 6.0x, we continue to acknowledge the market’s increased concerns on liquidity, dependent on a lower working capital/sales ratio to avoid a continued covenant breach.
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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