CMD: A rose among the thorns

Swedish weed now rooted out

Green Landscaping Group (Buy, TP: SEK102.00) - Q3 mixed, yet firmly rooted

Q3 fell slightly short of consensus on the top line and EBITA; however, we believe the confirmed exit of a troubled contract provides more certainty on margins in Sweden. Norway was strong on the top line and EBITA margin, while Rest of Europe was weak on the top line, but strong on the EBITA margin versus consensus. We still like the multi-year M&A runway and reiterate our BUY. We have raised our target price to SEK102 (100).

Hafnia Minor model adjustments

We have updated our estimates owing to the Q3 report and Q4 guidance. Hence, we have raised our 2024e EBITDA by 1%, while we have lowered our 2025–2026e by 2–1%. We continue to be positive on the tanker space, and forecast an 18–19% earnings yield for 2025–2026. Combined with its LTV now being below the 20% threshold for a 90% payout ratio, this should bode well for capital returns through dividends and/or accretive buybacks (we estimate a P/NAV of 0.7x). We do not consider these changes to be material, and we have not changed our BUY recommendation. We reiterate our NOK96 target price.

The weekly navigator

From the past week, we highlight: 1) Kinnevik led a USD130m funding round in Enveda; 2) Latour continues delivering on its M&A agenda; 3) Lundbergs reported Q3 NAV was up 7% QOQ, as the Lundberg sphere tightens its grip on Industrivärden; and 4) we met VEF, following its portfolio company BlackBuck’s recent IPO.

Kindred Group (No_rec, TP: SEK) - Discontinuing coverage

We have discontinued coverage of Kindred Group following the delisting of the stock after the acquisition by Française des Jeux. Our last published recommendation, target price and estimates should no longer be relied upon.