SalMar (Hold, TP: NOK550.00) - Yet another solid quarter
SalMar delivered yet another solid beat, outperforming our estimate and consensus on revenues by 38–32% in Q3 on a higher realised price. The strong operating results triggered payment of the previously cancelled 2019 DPS of NOK13, and a new more targeted dividend policy was announced. We have raised our 2020–2022e EPS by 2.1–0.5% after the results and our expectation of a higher price premium, partly offset by a slightly lower harvest from Icelandic Salmon. We have raised our target price to NOK550 (520), but given the limited potential upside, have downgraded to HOLD (BUY).SalMar is a producer of Atlantic salmon and is integrated from roe and smolt to products and sales. Co. has farming operations in Central and Northern Norway, as well as in Scotland. Co. has operating licences for marinephase fish farms and hatcheries in central Norway and Troms County. Co. has 66 licences for production of farmed Atlantic salmon in Norway: 53 in central Norway (More & Romsdal, South and North Trondelag) and 13 in northern Norway (Troms)
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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