Nokian Tyres (Hold, TP: EUR32.00) - Fairly priced
We have upgraded Nokian Tyres to HOLD (SELL) following a Q1 report clearly above expectations. We have raised our 2021–2023e segment EBIT by 5–7% and no longer deviate materially from consensus. Despite some uncertainty regarding the pace of the recovery, we consider the valuation balanced at a 2022e EV/EBIT of 12.6x, also given the company’s position as a niche segment market leader with interesting long-term growth opportunities. We have raised our target price to EUR32 (29).Nokian Tyres is a tyre manufacturer. Co. mainly sells its products in the aftermarket. Co. and its subsidiaries include the Vianor tyre retail chain, which provides wholesale and retail services in Co.'s primary markets. The core business units in Co. and its subsidiaries are Passenger Car Tyres, which develops, manufactures, and markets summer and winter tyres for passenger cars and delivery trucks as well as SUVs; Heavy Tyres, which focuses on special tyres; as well as Vianor, which provides tyres for all vehicles: passenger cars, vans, trucks, and heavy machinery. In addition to Nokian-branded tyres, the Vianor tyre retail chain sells other tyre brands and a variety of motoring products.
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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