Novozymes (Sell, TP: DKK310.00) - Focus moves to 2021e
Q3 revenues were in line with our forecasts, with destocking in Household Care and Food & Beverages, but a better recovery in Bioenergy and worse destocking in feed than we expected. The 2020 organic revenue growth guidance was kept at -2% to +2%, while the EBIT margin guidance was raised to 26–27% (c26%). Focus is now set to shift to 2021, where we forecast 4.4% organic growth. We reiterate our SELL but have raised our target price to DKK310 (290).Novozymes is a biotechnology company based in Denmark. Co.'s business operations are centered on the development of industrial enzymes, microorganisms, and biopharmaceutical ingredients. Co. provides business-to-business biological solutions used in the production of numerous products such as biofuel, detergents, feed, and crops. Co.'s business operations are organized along two segments: the Enzyme Business which is divided into four areas, providing industrial enzymes for household care, food & beverages, bioenergy, and feed & other technical; and the BioBusiness which is home to Co.'s microorganisms and biopharmaceutical ingredients.
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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