Momentum Group (Buy, TP: SEK255.00) - Split on track for H1 2022
Q3 saw another QOQ improvement, with Alligo reporting a positive volume contribution and Component & Service (C&S) seeing the payback from acquisitions. We view the H2 2022e split of the group as a catalyst to expose the full value potential, with the larger Alligo a growth and internal efficiency extraction case, and the smaller C&S a ‘buy and build’ platform for consolidating the fragmented Nordic industrial service sector. We reiterate our BUY and have raised our target price to SEK255 (230).Momentum Group Ab. Momentum Group AB is a Sweden-based reseller of industrial consumables and components, as well as service and maintenance to professional end users in the industrial and construction sectors in Sweden, Norway and Finland. The Company comprises six operating areas, which are organized under two business areas: Tools & Consumables and Components & Services. The Tools & Consumables business area comprises TOOLS Sweden, TOOLS Norway, TOOLS Finland and Mercus Yrkesklader. The business has focus on the sale of tools, personal protective equipment and other consumables to the industrial and construction markets. The network consists of 120 local sales outlets in Sweden, Norway and Finland. The Components & Services business area comprises Momentum Industrial and Gigant, which focus on the sale of spare parts for production and workplace equipment mainly to customers within industrial 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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