Norske Skog (Hold, TP: NOK35.00) - Demand cliff ahead
The collapse in paper demand has sent industry operating rates plunging, and the pace and extent of an eventual demand recovery are uncertain. We expect Norske Skog’s Q2 EBITDA to decline 63% YOY due to low volumes, and see pricing pressure emerging in H2, adding to the difficult situation. We have downgraded to HOLD (BUY) and cut our target price to NOK35 (40).
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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