Tomra (Sell, TP: NOK140.00) - Solid top-line growth, soft margins
Q1 EBITA of NOK277m was 16% below our forecast and consensus, mainly driven by softer than expected results in Recycling and Food. We have made minor negative estimate revisions on the back of the report and maintain our view that Tomra lacks the attributes to justify trading at a 2024e P/E of ~31x. We thus reiterate our SELL and NOK140 target price.Tomra Systems is a creator of sensor-based solutions for optimal resource productivity within the business streams of reverse vending, material recovery, compaction, recycling, mining, and food. Co.'s operating structure comprises two business areas and six business streams. The TOMRA Collection Solutions businesss area consists of three business streams: reverse vending, material recovery, as well as compaction. The TOMRA Sorting Solutions, business area consists of three business streams: food, recycling, and mining.
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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