YIT (Sell, TP: EUR1.40) - 2024 also set to be challenging
We expect improving the balance sheet with capital releases and asset disposals to remain management’s focus in 2024, with the guidance including adj. EBIT of EUR20m–60m due to challenging markets, particularly in Finland. Given current CRE markets, we are concerned the Tripla Mall sale could end up below its EUR192m equity value. We also remain concerned YIT might need to raise equity this year. As expected, the Q4 results were weak, and no DPS was proposed for 2023. We reiterate our SELL and EUR1.4 target price.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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