Yara (Buy, TP: NOK550.00) - Stability and dividends
Yara’s Q2 results disappointed, with lower selling prices than expected. The announcement of a NOK20 extraordinary DPS is in line with its stricter capital control ambition and prioritising shareholder returns. We have reduced our 2022–2023e EPS by 2% on prospects of somewhat lower premiums for Yara’s high-quality products in current strong market conditions. We maintain our BUY and NOK550 target price; we continue to like Yara’s high-quality earnings base with a strong dividend focus, supplemented by scope for the current demand-driven market prevailing longer than most market participants seem to believe.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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