Report
Joachim Gunell
EUR 463.07 For Business Accounts Only

HMS Networks (Buy, TP: SEK375.00) - Look beyond H1 2023e

HMS Networks’ slowing order momentum remains in focus; we expect a trough by mid-2023. We believe investors are well aware of the deceleration – valuation multiples are down 55% YTD and approaching the 10-year historical average – and that a re-rating is drawing closer on: 1) 2024 prospects; 2) potential for increased medium-term financial targets; 3) a more positive sell-side view; and 4) a net cash position suggesting ~27% M&A upside potential to our base-case EPS by 2025. We have upgraded to BUY (HOLD) and raised our target price to SEK375 (310).
Underlying
HMS Networks AB

HMS Networks AB (HMS) is a Sweden-based company engaged in the provision of communication technology for industrial automation. The Company provides solutions to connect industrial devices to networks and products enabling interconnection between different industrial networks. The Company's products are classified into two brands, namely Anybus and Netbiter. HMS, under the brand name Anybus, manufactures and markets intelligent communication technology for machines and electrically controlled equipment. Under the brand name Netbiter it develops and sells communication equipment that facilitates remote management through the Internet, either via the fixed telephony network or the mobile telephony network. The Company operates through numerous subsidiaries, including HMS Industrial Networks AB, IXXAT GmbH, a supplier of communication technology for industrial automation, machine manufacturing and the automotive industry, as well as eWON SA.

Provider
DnB Markets
DnB Markets

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.

 

Analysts
Joachim Gunell

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