Storytel (Buy, TP: SEK80.00) - Q3 displays flywheel dynamics
Storytel’s broad-based Q3 beat showcased flywheel dynamics, with solid net adds, record-low churn, a growing share of internal content consumption raising margins, improved customer acquisition efficiency, operating leverage from cost savings, and strong cash flows. We reiterate our BUY and have increased our target price to SEK80 (78), as Storytel’s raised full-year guidance continues to fuel positive consensus revisions, allowing for a combination of a step-change in earnings, FCF momentum, and an undemanding valuation, in our view. We also note Storytel’s 2025e net cash allows for flexibility to accelerate growth through M&A, amortise its RCF, or pursue dividends/buybacks.
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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