Nel (Sell, TP: NOK7.00) - Neutral ahead of Q1, but premium valuation build downside potential
We forecast Q1 sales of NOK321m and EBITDA of NOK-181m, in line with consensus. We expect the alkaline business to show financial improvements during 2023, following the higher-margin, large-scale contracts secured over the past year, but we believe focus in the Q1 report will be on whether the company can limit losses in the struggling fuelling business as well as its longer-term outlook for the business. Despite declining 30% from the peak in February, Nel is trading at c2x peers’ EV/sales, suggesting c50% downside potential. We reiterate our SELL and NOK7 target price.NEL ASA develops diagnostic tests for early detection of diseases. Co.'s patented method is based on identifying disease-specific gene expression signatures from sample materials, such as blood. Co.'s products in development phase include MCItect, for patients with Mild Cognitive Impairment (MCI) aimed to detect Alzheimer disease within two years prior to onset of dementia, and ADtect, for the detection of mild to moderate Alzheimer disease, as well as one project in discovery phase, namely AMYtect, for brain amyloid detection.
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.
Unfortunately, this report is not available for the investor type or country you selected.
Browse all ResearchPool reportsReport is subscription only.
Thank you, your report is ready.
Thank you, your report is ready.