June: Pulp shipments flat y-o-y

Costs push prices higher

A long list of price increases as costs push prices higher. Q2e EBIT likely down q-o-q: higher maintenance costs. Smart to buy when macro is low.

PGS (No_rec, TP: NOK) - Discontinuing coverage

Following the merger with TGS, set to close on 1 July, and the subsequent de-listing of PGS shares, we have discontinued coverage. Our last published recommendation, target price, and estimates should no longer be relied upon.

TGS (Hold, TP: NOK125.00) - Vessel utilisation set to disappoint

We are broadly in line with company-compiled consensus for TGS ahead of its Q2 revenue update. However, following the recently closed merger with PGS, we see meaningful downside risk to consensus revenue estimates related to the latter, where we are 24% below the most recent company-compiled consensus. We believe vessel revenue expectations remain too high as consensus appears to keep overestimating utilisation, which is set to disappoint for Q2, leaving downside risk to combined 2024 estimates. We reiterate our HOLD and NOK125 target price.

Selvaag Bolig (Sell, TP: NOK30.00) - Flippers are back

With expectations of interest rates having peaked, the flippers are back, with a catch-up effect in the Norwegian new-build market, helping Selvaag Bolig to sell 207 homes net in Q2, well above our forecast of 125. While 95 unit starts were lower than we expected, we estimate a catch-up effect in H2. However, profits remain trailing and we believe the valuation is too high, hence we find better risk/reward elsewhere. We reiterate our SELL, but have raised our target price to NOK30 (25).