Jm Ab (Hold, TP: SEK315.00) - Weak Q1, but strong sales
JM’s Stockholm EBIT margin continued to decline and led to Q1 group EBIT 14% below our estimate and 15% below consensus. However, housing sales (KPI) – even excluding the investor sale in Helsinki – were well above our forecast (the highest among consensus), and JM announced two Swedish regulated rental block divestments, which it stated would lead to SEK390m in profit. As a result, despite the weak Q1 EBIT, we have raised our 2021e EPS. However, as the valuation looks high, we reiterate our HOLD and SEK315 target price.JM is a developer of housing and residential areas in the Nordic region. Co. focuses its operations on new production of homes, with the main focus on metropolitan areas and university towns in Sweden, Norway, Denmark, Finland and Belgium. Co. is also involved in project development of commercial premises and contract work, primarily in the Greater Stockholm area. Co. is divided into five business units: JM Residential Stockholm, JM Residential Sweden, JM International, JM Property Development and JM Production.
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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