Swedish Match (Buy, TP: SEK85.00) - Delving into Zyn
We reiterate our BUY and have raised our target price to SEK85 (76) following a change of analyst. We believe Swedish Match has the investment qualities of tobacco, but with higher growth and lower risk. The upside potential for Zyn looks widely underappreciated (we are c21% above 2024e consensus). With the FET risk seemingly removed on Friday, a possible cigar spinoff in H2 2022e, and the stock trading at a 2022e P/E of c17x, we see scope for multiples expansion over the next year.
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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