DnB Markets - Wallenius Wilhelmsen Logistics ASA (WAWI) Wallenius Wilhelmsen Logistics (Buy, TP: NOK67.00) - Consensus is catching up

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DnB Markets

Nicolay Dyvik

Wallenius Wilhelmsen Logistics (Buy, TP: NOK67.00) - Consensus is catching up

A similar share price reaction has only been seen twice post the Glovis spin-off and the merger with Wallenius, showing the gap between earnings capacity at cycle lows and market expectations. We are still above consensus EBITDA for 2018e, although at half that of post Q2. We find WWL attractive as merger synergies help bridge the gap ahead of a slow improvement in auto shipping and gradual recovery in mining shipments, driven by higher metal prices and an age-related replacement cycle. We reiterate our BUY recommendation and have raised our target price to NOK67 (60).

08/11/2017 17 EN

Underlying

Wallenius Wilhelmsen Logistics ASA

Wallenius Wilhelmsen ASA, formerly Wallenius Wilhelmsen Logistics ASA, is a Norway-based shipping company. It is engaged in roll-on/roll-off (ro-ro) shipping and vehicle logistics, transporting cars, trucks, rolling equipment and breakbulk worldwide. The Company's activities are divided into two reporting segments: Ocean and Landbased. The Ocean segment transports cars and ro-ro cargoes and comprises of a fleet of more than 100 vessels. The Landbased segment provides terminal and inland logistics solutions and operates over 10 terminals in more than 15 countries. Wallenius Wilhelmsen ASA operates as a holding company for the Group that consists of Wallenius Wilhelmsen Ocean, Wallenius Wilhelmsen Solutions, EUKOR and ARC.

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NO0010571680 Oslo Bors Norway

Provider

DnB Markets

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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Analysts

Nicolay Dyvik

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Wallenius Wilhelmsen ASA (Buy, TP: NOK152.00) - Market strength with latency

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February 15, 2024 February 15, 2024 1 EN

Boliden (Buy, TP: SEK420.00) - In a sweet spot

Despite low mining volumes, the Q1 results were close to our expectations, thanks to good cost control. We have made significant estimate increases on better metal price and FX assumptions, and beyond 2024 we continue to see additional earnings support from: 1) higher mining volumes due to richer metal grades; 2) normal operations at Rönnskär; and 3) growing profits from the Odda smelter. Our spot-based estimates for 2027 translate to an EV/EBIT of 5.2x, but we see significant upside potential to our forecasts on our view of a promising outlook for copper and gold. We have raised our target pr...

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Douglas Lindahl

Douglas Lindahl

Beijer Ref (Hold, TP: SEK156.00) - Building (cash flow) confidence

We have increased our cash flow estimates but have made moderate underlying forecast changes after the Q1 report. Inclusion of recent M&A and updated FX has led us to raise our adj. EBITA by c3% on average for 2024–2026e. We have raised our target price to SEK156 (152) due to our model changes and updated peer multiples. We reiterate our HOLD and see limited upside potential given the valuation seems on the high side.

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Mattias Holmberg

Mattias Holmberg

Epiroc (Buy, TP: SEK230.00) - Mix headwind, benefits to come

Similar to Sandvik’s Mining business, the main miss in Epiroc’s Q1 was the soft margin, albeit for different reasons. Sandvik pointed to the unfavourable timing of equipment deliveries, while Epiroc alluded to a pure mix issue (high share of equipment, low share of service). Only small benefits from Epiroc’s cost measures have started to show – we expect more to be gradually realised through 2024. We have trimmed our 2024–2026e adj. EBIT by 1% on average. We reiterate our BUY, but have lowered our target price to SEK230 (235).

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Wallenius Wilhelmsen Logistics (Buy, TP: NOK67.00) - Consensus is catching up

Wallenius Wilhelmsen ASA Minor model adjustments

A brewing challenge for the yards

Wallenius Wilhelmsen ASA (Buy, TP: NOK152.00) - Market strength with latency

Boliden (Buy, TP: SEK420.00) - In a sweet spot

Beijer Ref (Hold, TP: SEK156.00) - Building (cash flow) confidence

Epiroc (Buy, TP: SEK230.00) - Mix headwind, benefits to come

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