Loomis (Buy, TP: SEK460.00) - Ziemann acquisition blocked
The Bundeskartellamt blocking the planned acquisition of Ziemann was a negative surprise, meaning Loomis still has some way to reach its 2021 targets; however, financial resources are available for further actions. Deconsolidating Ziemann, lowered organic growth estimates and negative FX imply 7–8% cuts to our 2020–2021e EPS. However, the investment case still looks solid, based on CMS/SafePoint growth and we reiterate our BUY and have raised our target price to SEK460 (440), as we move the valuation base to 2022e.Loomis AB is a holding company. Through its subsidiaries, Co. provides solutions for cash handling in the U.S., majority parts of Europe and in Argentina. Co. provides cash in transit (CIT), cash management services (CMS) and solutions which integrate CIT with CMS. The CIT service transports cash to and from stores, banks and automated teller machines (ATMs). The CMS service counts, quality controls and packages bills and coins in Co.'s cash centers. Co. also provides solutions for retail outlets and for maintenance of ATMs, as well as analysis, forecasting and reporting of customers' cash flow. The services are targeted at banks, retailers, commercial enterprises and the public sector.
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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