Storskogen (Buy, TP: SEK8.70) - Another year of deleveraging focus
Q4 was weak with an 8.5% sales decline YOY and narrowing profit margins, while FCF generation remained a point of strength. The near-term outlook seems less supportive, translating into 11–7% cuts to our 2024–2025e EPS and with the focus remaining on deleveraging and internal efficiency. Thus, we see a less-eventful 2024 ahead, with our forecasts suggesting the gearing target of 2.0x RTM net debt to EBITDA should be reached by end-2024e. We continue to see value support (2024–2026e FCF yields of 25–28%) and reiterate our BUY, but have cut our target price to SEK8.70 (10.70).
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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