Veidekke (Buy, TP: NOK150.00) - Still seeking M&A growth
With more cash than equity, M&A remains a potential catalyst that we believe Veidekke should use for further growth. Ahead of the Q4 report (due at 07:00 CET on 9 February), we expect possible upside to consensus, as reported 2021e figures have shown EBIT margins in recovery. With an EC White Paper aiming to regulate and speed up renovation and modernisation on existing builds, we have raised our long-term growth forecasts and our target price to NOK150 (145). We reiterate our BUY.Veidekke is a Scandinavian construction and property development company. Co.'s segments are grouped according to activity. The construction segment comprises mainly the construction of buildings and infrastructure. The property segment comprises the development of sites, property development and the sale of property (primarily residential). The industry segment comprises the production of aggregates (crushed stone and gravel) and asphalt, the laying of asphalt and road maintenance.
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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