Yara (Buy, TP: NOK475.00) - Déjà vu in Q2
Yara’s Q2 results resembled those in Q1, by missing consensus due to further write-downs and falling fertiliser prices. As fertiliser prices have risen in the past month, we expect more normalised EBITDA closer to Yara’s run-rate for the quarters ahead. We have made very limited estimate changes on the back of the report, and keep our NOK475 target price. We reiterate our BUY as we find Yara attractively valued at a 2024e P/E of 10.7x while the fertiliser markets appear to be tightening and urea prices are appreciating.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.
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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