Hexagon Composites (Buy, TP: NOK45.00) - Hitting the (natural) gas
Hexagon Composites has raised NOK300m for financial flexibility to pursue specific near-term acquisition opportunities to further exploit the favourable markets it operates in, and for supporting Hexagon Purus. We see the company benefiting from strong market tailwinds and higher activity ahead. We reiterate our BUY and have raised our target price to NOK45 (40). Stand-alone Hexagon Composites is trading at what we consider an attractive 2025–2026e EV/EBITDA of 8.3–6.8x.Hexagon Composites is divided into three business segments. Co.'s Hexagon Ragasco segment manufactures low-pressue composite cylinders, such as cylinders for propane gas; and Co.'s Hexagon Lincoln/Hexagon Raufoss segment develops and supplies complete storage and transport systems for natural gas and hydrogen to the bus and automotive industry and for bulk transport of compressed gas. The Group's activities are divided into the following regions: Europe, North America, South-East Asia, Middle East and South America.
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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