Jm Ab (Sell, TP: SEK324.00) - High valuation post speculation
While our 2021–2023e forecasts are in line with consensus, we continue to see downside potential for the share price. In our view, the speculation that SBB Norden might acquire JM has moved the share price too far above peers. Consequently, we see better risk/reward elsewhere. We are broadly in line with consensus on Q4 (report due at 08:00 CET on 2 February), but reiterate our SELL given the potential valuation downside relative to peers. We have raised our target price to SEK324(320) on minor forecast changes.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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