Industrivärden (Buy, TP: SEK280.00) - Layers of discount offer value
Historically, Industrivärden has offered geared exposure to a macro recovery. With improved balance sheet resilience across Industrivärden and its underlying portfolio, we now forecast 30% 12-month forward NAV growth despite cyclical concerns for 2023. Also, we believe the stock offers attractive value at: 1) a 11% discount to its NAV, trading at a portfolio-weighted P/E of 12x (a 10% discount to its 10-year average and a 23% discount to the OMXS30 versus the historical average of 12%); and 2) a YTD adj. FCF yield of 2.3% and 2023e dividend yield of 3.1%. We reiterate our BUY and lower our target price to SEK280 (290).AB Industrivarden is a holding company with an active ownership role in a concentrated selection of listed Nordic companies with good development potential. Co.'s mission is to create shareholder value based on a professional investment operation and active ownership in its portfolio companies. The goal is to generate high growth in net asset value over time.
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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