Solon Eiendom (Hold, TP: NOK25.00) - Weak Q4; strong so far in Q1
The 9.3% EBIT margin led to a significant Q4 miss on our numbers. However, with 85 units sold so far in Q1, we have raised our forecasts. We expect Solon to enter a super-cycle as historical residential plot gains translate into EBIT margins. However, with these non-recurring plot gains, we do not expect P/E valuation to normalise. Nevertheless, on adjusted forecasts, we have upgraded our recommendation to HOLD (SELL), with a NOK25 target price (NOK20).Solon Eiendom is a biotechnology company. Co.'s focus is the research and development of peptide based vaccines against viral diseases, primarily human immunodeficiency virus (HIV). As of Dec 31 2013, Co.'s clinical development pipeline comprised of two vaccine candidates for the treatment of HIV, Vacc-4X and Vacc-C5. Vacc-4X is being investigated in two phases II trials in collaboration with Celgene Inc.
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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