Scatec (Sell, TP: NOK72.00) - Take profits
Declining prices of solar parks looks likely to result in higher growth opportunities in the years ahead. However, we still see growth possibilities limited by Scatec’s leveraged balance sheet, with a 2024e NIBD/EBITDA of 5.8x. With the company highlighting assets in non-core markets as the most likely to be sold during the year, we are concerned leverage will remain high. With underlying results and guidance only slightly above expectations, we consider the ~20% share price increase over the past week excessive and thus have downgraded the stock to SELL (HOLD). We reiterate our NOK72 target price.
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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