Telenor (Buy, TP: NOK145, +14%) Q1 24: Good numbers, impressive FCF generation

Telenor has reported a good set of Q1 numbers, with SR and EBITDA c1% ahead, and FCF 49% ahead. FY24 guidance has not been lifted (but has been reiterated) despite the good Q1 numbers, with phasing of payments/items to impact FCF throughout the rest of the year, and this is perhaps a little disappointing, but momentum is clearly with Telenor at present, and if current trends persist, then guidance and estimates will move up.

EBITDA-capex 3% above, strong FCF

Solid momentum into the year for Telenor

Solid momentum into the year for Telenor Telenor showed good momentum going into the first quarter with top-line growth in both the Nordics and Asia. "The first quarter was yet another solid quarter for Telenor. We continue to develop security services to protect our customers against digital attacks, and we see that it is important for our customers," says Sigve Brekke, CEO of Telenor. Services revenues in the first quarter ended at NOK 15.8 billion, corresponding to an organic increase of 5.6 per cent compared to the same period last year. EBITDA ended at NOK 8.5 billion, correspondin...

Panoro Energy (Buy, TP: NOK41.00) - Positive prospects

At its Q1 trading update, Panoro Energy reported net production of 9.6kboed, in line with our 9.5kboed forecast. We estimate EBITDA of USD42m (Bloomberg consensus at USD41m) ahead of the Q1 results (due at c07:00 CET on 23 May). We view the recent discovery at Hibiscus South as accretive to our NAV by ~NOK1/share, illustrating the strong prospectivity and commerciality at the Dussafu licence. We reiterate our BUY and NOK41 target price.

OX2 (Hold, TP: SEK60.00) - Offer unlikely to be raised

On 13 May, EQT announced it had launched a take-private bid for OX2 at SEK60/share, representing a 43% premium to the previous close. We believe the bid is somewhat low given OX2’s 2024–2025e project sales pipeline and the depressed share price prior to the bid. However, we see a raised offer as unlikely, since the main owner, Peas Industries (45.6% of the shares), has irrevocably accepted the offer, and the acceptance hurdle is set at 50%. We have downgraded OX2 to HOLD (BUY) and cut our target price to SEK60 (75) to reflect the offer.

Salmones Camanchaca (Buy, TP: NOK29.00) - BUY on attractive risk/reward

We expect Q1 operating EBIT of USD5.6m, broadly in line with consensus of USD5.4m. Harvest volumes of 9.9kt Atlantic salmon and 1.1kt Coho were announced in the Q1 trading update, with sold volumes of 12.3kt and 5.8kt, respectively. Ahead of the full Q1 report (due at 21:00 CET on 15 May), we have cut our 2024–2026e EPS by 1.6–10.0% after adjusting our cost, realised price and 2025–2026 harvest volume assumptions, and in turn trimmed our target price to NOK29 (30). However, we see an attractive risk/reward, with El Niño officially over, prospects of a recovery in US salmon prices, and the stoc...