Veoneer (Buy, TP: SEK300.00) - Time to harvest in 2021e
We expect warnings of chip shortages to continue to dampen auto-sector sentiment short-term, but Veoneer appears well positioned to outperform LVP as soon as Q1e, and we forecast organic growth to accelerate to 29% YOY in 2021e with key launches on track. We still like Veoneer’s large order backlog, set to drive 20%+ sales growth medium-term, a 2021e rebound in LVP, and cost discipline leading to EBIT and FCF breakeven in 2023e. We expect a continued re-rating as investors gain confidence in Veoneer’s 2023 targets and reiterate our BUY and SEK300 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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