Hexpol Minor model adjustments
We expect the continued deterioration in PMIs since Q1 to result in a further weakening in organic growth (to -7% YOY in Q2e, following -6% in Q1) while raw material prices flattening out YOY should provide some stabilisation to the EBIT margin (we forecast a flat margin QOQ at 15.4%). We are 2% above Bloomberg consensus on Q2e sales, and 1% above on EBIT. We have lowered our 2019–2021e sales and EBIT by 1–2% ahead of the Q2 results (due on 18 July) owing to FX fluctuations since our last update. We do not consider these changes to be material, and we have not changed our HOLD recommendation. We have lowered our target price from SEK82 to SEK80.
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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