Hexagon (Buy, TP: SEK145.00) - Shaping up nicely
We see six potential drivers that could take the stock back to all-time highs in 2025: 1) long-awaited acceleration in organic growth; 2) earnings momentum translating into 21% adj. EPS growth YOY in 2025e; 3) the ‘NewCo’ spin-off (~20% of group EBIT) crystallising values; 4) Björn Rosengren as vice board chair and Anders Svensson as CEO appealing to a broader international investor base; 5) strong Q4 results encouraged bulls and de-risked the 2025e case, and could attract new investors; and 6) an undemanding valuation. We reiterate our BUY and have raised our target price to SEK145 (137), while our value gap analysis implies upside potential to SEK225.
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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