YIT (Buy, TP: EUR5.50) - Attractive risk/reward – BUY
We believe YIT offers an attractive risk/reward following its underperformance of the market and peers – and have upgraded the stock to BUY (HOLD). We now also expect Covid-19 to have less of a negative impact, prompting us to raise our 2021e EPS by 6.9%, and in turn our target price to EUR5.50 (5.00). However, a slightly lower market forecasts mean we have reduced our 2022e EPS by 2.9% and 2023e by 1.3%. At end-Q4 YIT guided for 2021 EBIT to be up YOY, and we await more detailed guidance with the Q1 results. However, Q1 marks the seasonal low for YIT, reflected in our estimate of close to zero EPS (results due at 08:00 CET on 30 April).YIT provides services for the construction sector. Co. has two segments: Housing and Business Premises and Infrastructure. The Housing segment is engaged in the development and construction of housing, holiday homes and entire residential areas, with a focus on its own developments. This segment is also engaged in property maintenance in Russia. The Business Premises and Infrastructure segment is engaged in the development and construction of offices, shopping malls, public facilities, assisted living facilities and other business premises; renovation projects; construction of roads, bridges, tunnels, rail and metro stations, ports and power plants; as well as road and street maintenance.
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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