Skanska (Buy, TP: SEK210.00) - Internal deals support Q4e
We are 4% below Infront consensus on segment-based EBIT ahead of the Q4 report (due at 07:30 CET on 3 February), as we are 38% below on EBIT for Residential Development (RD) due to weak housing markets. However, we expect a gain for Commercial Development (CD) from two internal sales to the Investment Property (IP) division in Q4, but this should not have any cashflow effect. Due to our SOTP, the strong balance sheet and solid dividend yields, we reiterate our BUY and target price of SEK210.Skanska is a project development and construction group, concentrated on selected home markets in the Nordic region, European countries and in the Americas. Co.'s business streams are: construction, which includes building and civil construction; residential development, which develops residential projects for immediate sale; commercial property development, which initiates, develops, leases and divests commercial property projects, with project development focusing on office buildings, retail and logistics properties; and infrastructure development, engaged in identifying, developing and investing in privately financed infrastructure projects, such as highways, hospitals and schools.
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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