Industrivärden (Hold, TP: SEK305.00) - Value case not strong enough
With a still-wide relative gap between growth and value stocks, Industrivärden continues to offer relative value characteristics, as indicated by its NAV decline of 10% versus the SIXRX at -23% in 2022, with: 1) a 13% discount to its NAV, trading at a portfolio-weighted P/E of 15x (a 5% discount to the OMXS30, versus the historical average of 12%); and 2) a 2022 adj. FCF yield of 2.1% and 2023e dividend yield of 2.7%. Having updated our portfolio view, we forecast 12-month forward NAV growth of 10%, which, combined with a 15% discount to the NAV target, leaves us in neutral territory. We reiterate our HOLD but have raised our target price to SEK305 (280); we prefer Investor (BUY) in the sector.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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