Swedish Match Minor model adjustments
We forecast Q2 EBIT from product areas of SEK1,588m (up 9% YOY), with growth hampered by a reversal of the positive hoarding effect seen in Q1 (the Q2 results are due at 08:15 CET on 17 July). We have fine-tuned our estimates, partly owing to FX movements (e.g. the USD depreciation versus the SEK). We do not consider these changes to be material, and we have not changed our BUY recommendation. We have raised our target price to SEK720 (685), based on an average blended target 2021–2022e EV/EBIT of 16x, in line with the historical average.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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