Report
Niclas Gehin
EUR 88.46 For Business Accounts Only

Yara (Buy, TP: NOK450.00) - Step change in cash generation

Yara reported Q3 EBITDA in line with our estimate and consensus. Our main take-aways from the report were the announcement of a solid NOK18 extraordinary dividend and the strong free cash flow generation, which took the NIBD/EBITDA to 1x (Target range: 1.5–2x). We have cut our 2021–2022e EPS by 4% to account for somewhat softer nitrate and urea market trends since our previous update. We still consider Yara attractively priced at a 2021e P/E of 9x and prospects for a sustainable dividend yield of 10%+. We reiterate our BUY and NOK450 target price.
Underlying
Yara International ASA

Yara International is a holding company. Through its subsidiaries, Co. converts energy, natural minerals and nitrogen from the air into products for farmers and industrial customers. Co. provides mineral fertilizers, industrial products and environmental products and services to its customers. Its mineral fertilizer portfolio, sold as five main brands (YaraMila, YaraLiva, YaraVita, YaraBela, YaraVera) represents a range of crop nutrients. Its industrial portfolio contains a range of nitrogen chemicals as well as CO2 and dry ice. Its environmental product and services reduce NOx emissions, control unpleasant odor, prevent toxic gases, avoid corrosion and improve water quality.

Provider
DnB Markets
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.

 

Analysts
Niclas Gehin

Other Reports on these Companies
Other Reports from DnB Markets

ResearchPool Subscriptions

Get the most out of your insights

Get in touch