Systemair - Initiation of coverage - A breath of fresh air
Systemair has seen c10% annual sales growth over the past 10 years, with M&A the largest contributor. The high acquisition rate has come at the expense of margins, which management is trying to remedy through price hikes and internal efforts. However, we do not expect it to reach its 10% EBIT margin target until 2025. Growth in its main end-markets looks solid, but current valuation leaves limited upside potential in our view. Hence, we initiate coverage with a HOLD and SEK75 target price.
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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