Wihlborgs (Buy, TP: SEK95.00) - Benefiting from recent deleveraging strategy
In our view, recent years’ deleveraging has left Wihlborgs well placed, with limited refinancing risk. However, it has a fairly high share of floating-rate debt (existing hedges will only cover c30% of its debt by end-2024e) – although this is well reflected in consensus, and we find a 2024e P/FFO of 14x attractive given its financial strength. Also, we see good possibilities of close to full CPI rent adjustments. We reiterate our BUY and have raised our target price to SEK95 (75) on a lower yield assumption.Wihlborgs Fastigheter is a property company that focuses on commercial properties in the Oresund region. Co.'s property portfolio is located in Malmo, Helsingborg, Lund and Copenhagen. At Dec 31 2013, the property portfolio consisted of 264 properties, including 12 with site leasehold rights, with a total lettable area of around 1.5 million square meters.
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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