William Demant Holding (Hold, TP: DKK220.00) - 2019 guidance below estimates

2019 guidance below estimates H2 sales were slightly below consensus, and the adj. EBIT margin was weak at just c19.3% versus our forecast and consensus of c20.8%. The 2019 EBIT guidance of DKK2.65bn–2.95bn was also weak, with the top end below both our estimate and consensus. In addition, the successor to Oticon Opn was revealed, set for launch in Q1, in time for the VA window in May. We expect consensus 2019e EPS to come down c3% and a 3–5% negative share price reaction today.

Northern Lights

William Demant Holding (Hold, TP: DKK220.00) -

William Demant Holding (WDH DC, Hold) - (14 pages)

Wihlborgs (Hold, TP: SEK105.00) - Too-high premium versus peers

Q1 profit from property management (PFPM) was 1% above consensus and net lettings were on the strong side. Overall, we have made only minor estimate changes, raising our 2025–2027e FFOPS by 2–3%. With a large pipeline of ongoing projects (c1.5x of 2025e FFO left to invest) and following recent acquisition, the LTV is at its highest level since 2018. We see limited further FFOPS upside potential for 2025–2027. We consider the stock close to fully valued near-term and the valuation rich versus peers. We reiterate our HOLD, but have cut our target price to SEK105 (120).

Subsea 7 (Buy, TP: NOK205.00) - Saipem uncertainties reflected

We expect that seasonality and planned maintenance days will affect Q1, and are thus 15% below consensus (our full-year estimates are in line). We believe investor concerns around the Saipem merger are well reflected in the share price, as combined company multiples have come to Saipem stand-alone levels (prior to deal announcement). With cNOK40/share in shareholder returns (c26% of share price) over the next ~18 months, we consider the valuation attractive and have upgraded to BUY (HOLD). We reiterate our NOK205 target price.

Avance Gas (No_rec, TP: NOK) - Discontinuing coverage

We have discontinued coverage of Avance Gas, as it no longer has any assets, and does not plan to make any new investments. According to the company, remaining funds after its final USD0.74 DPS, to be paid on 7 May (ex-date 24 April), are expected to be used to settle any outstanding obligations to creditors, including liquidation fees, and the stock is expected to be delisted in June/July 2025. Our last published recommendation, target price and estimates should no longer be relied upon.