Nordic Paper Holding (Buy, TP: SEK50.00) - 10%+ dividend yield for 2022e
The seasonally weaker Q3 report was largely in line with our forecasts, while operating cashflow of cSEK260m was much above our expectation. While we expect higher/volatile electricity and wood prices to have a significant impact on Nordic Paper’s operating costs, we also expect price rises to neutralise much of this. As well as having a robust balance sheet, Nordic Paper is trading at an attractive 2023–2024e P/E of 6x, and our raised 2022e DPS of SEK3.5 translates into a yield of almost 12%. We reiterate our BUY and target price of SEK50.
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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