Kongsberg Gruppen (Buy, TP: NOK680.00) - Solid earnings trajectory
Q4 EBITDA was NOK1.7bn, 8–7% above our estimate and consensus, driven by strong underlying performance across all segments. We have raised our 2024–2025e EPS by 6–5% on the Q4 print and find the 2025e P/E of ~21x too modest, as we believe the earnings compounding effect is set to continue beyond 2025. We reiterate our BUY and have increased our target price to NOK680 (575) on our raised estimates and multiples expansion among defence and maritime peers.Kongsberg Gruppen supplies technology systems and solutions to customers engaged in the oil and gas industry, the merchant marine, and the defense and aerospace industries. Co.'s operating segments are Kongsberg Maritime, which delivers products and systems for commercial vessels and offshore installations, as well as for seabed surveys, surveillance, training simulators and fishing vessels and fisheries research; Kongsberg Defence Systems, a supplier of defence and space-related systems; Kongsberg Protech Systems, which provides weapon guidance system Protector RWS for military use; and Kongsberg Oil & Gas Technologies, a supplier of solutions to the international oil and gas industry.
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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