Tomra (Sell, TP: NOK320.00) - Slow Q1e before gearing up
We expect Tomra to report Q1 EBITA of NOK256m (results due at 07:00 CET on 29 April), with lower new market sales within Collection, in addition to a slow quarter for Food (as usual in Q1). We forecast Q1 EBITA of NOK67m in Recycling & Mining, based on 60% conversion of the Q4 NOK702m order backlog, flat opex QOQ and a 53% gross margin. That said, we expect all segments to pick up pace significantly later in 2022 (in particular Collection in H2). We still believe Tomra is overpriced and reiterate our SELL and NOK320 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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