Mycronic (Buy, TP: SEK500.00) - Build position at these levels
Mycronic’s 6% MF consensus EBIT beat in Q1 was overshadowed by its lower 2025 sales guidance, which we believe bakes in prudence. We consider the recent pullback in the stock a reinforced buying opportunity as we like its: 1) durable secular demand from advanced electronics, semiconductors, AI and reshoring; 2) deep competitive moats from strategic cutting-edge technology; 3) large share of defensive aftermarket sales; 4) strong balance sheet and proven M&A track record; and 5) attractive valuation. We reiterate our BUY but have cut our target price to SEK500 (525) on lower 2025e EBIT.Micronic AB provides production solutions for manufacturing electronics products. Co. has two business areas. Surface Mount Technology provides production equipment and solutions for mounting components on circuit boards, an indispensable part in electronics products. Co. provides surface mount machines, software, automated storage solutions and peripheral equipment that handle all types of components and circuit boards. Pattern Generators provides production equipment and solutions for manufacturing of electronics products. Co. provides two types of pattern generators: mask writers for the manufacturing of photomasks and direct writers for the manufacturing of substrates.
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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