Sats (Hold, TP: NOK7.00) - New training programme needed
We expect Q3 to be another loss-making quarter for SATS, with memberships and yields too low to offset a growing cost base (results due at 07:00 CET on 28 October). We believe SATS needs to convince investors at the CMD (scheduled for the same day) that it can navigate the current challenging market, and that it needs to focus more on profitability than growth. We have cut our target price to NOK7 (10) on negative estimate revisions, but have upgraded the stock to HOLD (SELL) as we find the risk/reward improved following the c45% share price drop in the past three months.
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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