Lundbergs (Sell, TP: SEK415.00) - Winner on real estate windfall
Lundbergs has achieved an impressive 20-year NAV CAGR of 11%, and while we are 30% above its valuation of its unlisted real estate portfolio, we still only forecast -1% NAV growth in 2020 (previously -7%). Based on muted NAV growth prospects while trading at a reported premium to NAV of 5%, we believe it makes sense to take profits following the recent rally. We reiterate our SELL but have raised our target price to SEK415 (360) to reflect our updated portfolio view.L E Lundbergforetagen AB is an investment company that manages and develops a number of companies. The asset portfolio includes the wholly owned real estate company, Fastighets AB L E Lundberg, the publicly traded subsidiaries, Hufvudstaden and Holmen and the associated companies, Indutrade and Husqvarna. Co. also has major shareholdings in Industrivarden, Handelsbanken, Sandvik and Skanska. Co.'s subsidiary, L E Lundberg Kapitalforvaltning, is engages in securities trading. Operations consist of real estate operations, the manufacture and sale of printing paper, paperboard and sawn timber products, forest and power operations, and equity management (including securities trading).
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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