Storytel (Buy, TP: SEK320.00) - Particularly attractive entry point
Storytel’s Q1 streaming update held few surprises as it continued to meet its guidance. We remain bullish given its recent SEK1.2bn recapitalisation, reducing the financial risk, and ambition to add ~200k subscribers per quarter in Q2–Q4 2021, which is more than double the quarterly net adds seen in 2020. As growth stocks tend to trade on subscriber adds as a leading indicator of future value, we believe Storytel’s growth credentials should drive a re-rating of the stock. We thus reiterate our BUY and SEK320 target price, but see large value-creation potential as Storytel executes on its 2023e targets, suggesting a ~3x higher revenue scale.
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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