Olav Thon (Buy, TP: NOK220.00) - Deep value, strong performance
Tenant sales in the group’s malls increased by 6.4% in Q4. Reflectingthe new lockdown measures, with many of its shopping malls closed in 1Q20 and ongoing uncertainty, no dividend was proposed for 2020. However, we see prospects of an extraordinary payout later in 2021 if the market stabilises as we expect. Q4 profit from property management (PFPM) was in line with our estimate, but FFO missed on a higher tax rate. Olav Thon remains a deep-value – although limited liquidity and divided-yield – stock, but operations are solid and it has outperformed most European peers long-term. We reiterate our BUY and NOK220 target price.Olav Thon Eiendomsselskap is engaged as a property operator. Co.'s property portfolio is broken down into the following property segments: shopping centres and commercial property. At Dec 31 2013, Co.'s shopping centres comprised the management of 87 shopping centres, of which 27 are managed for external owners.
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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