Swedish Match Minor model adjustments
Ahead of the Q3 results (due on 25 October at 08:15 CET), we have raised our 2019–2021e EPS by 2–4% on the back of strong trends in Snus and Moist Snuff (SNS). This is driven by the ongoing national rollout of ZYN nicotine pouches in the US market. We do not consider our changes to be material. We expect Q3 group EBIT from product areas of SEK1,446m, up 10% YOY, with the healthy progress mainly driven by strong SNS and positive FX movements (USD appreciation versus SEK). We have not changed our BUY recommendation. We reiterate our SEK470 target price.Swedish Match develops, manufactures, markets, and sells snus and snuff, other tobacco products (cigars and chewing tobacco), and lights (matches and lighters). Snus and snuff are smokeless tobacco products that are produced and sold primarily in Sweden, Norway and the U.S. Other tobacco products represent cigars and chewing tobacco manufactured and sold on the U.S. market. Lights include manufacturing and distribution of matches and lighters. Other operations are primarily the distribution of tobacco products on the Swedish market. Primary brands include General snus, Longhorn moist snuff, White Owl cigars, Red Man chewing tobacco, Fiat Lux matches, and Cricket lighters.
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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