Hexagon AB (Buy, TP: SEK130.00) - Well positioned in a difficult market
We believe Hexagon is well positioned in an uncertain macro environment due to its structural growth drivers, pricing power and earnings resilience from having 35% recurring revenues. Our analysis shows it should be able to: 1) protect margins and organic growth better than its peers as the cycle worsens; and 2) surpass its medium-term adj. EBIT margin target of 30%+. We reiterate our BUY but have cut our target price to SEK130 (135) after cutting our 2023e adj. EBIT by 7%.
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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