reports
- Joachim Gunell
Hexagon (Buy, TP: SEK115.00) - Q1 results were a clearing event
Hexagon’s Q2e outlook was better than feared after its Q1 profit warning. We see an attractive risk/reward following the recent sell-off amid: 1) the organic sales growth and earnings momentum story unfolding with defensive traits (albeit bruised); 2) the ‘NewCo’ spin-off crystallising values; 3) new leadership starting on Monday, which should appeal to a broader investor base; and 4) an undemanding valuation on absolute and relative bases, near a historical trough. We reiterate our BUY but have...
- Joachim Gunell
Storytel (Hold, TP: SEK83.00) - Struggled to live up to expectations
Investors had grown accustomed to strong results after five consecutive quarterly ‘high quality’ beats. However, its Q1 results did not meet MF consensus, which dents the short-term momentum of the story, in our view. We believe Storytel could reverse the negative sentiment at its 15 May CMD, but remain on the sidelines to see if the high bar from consensus is revised. The valuation remains undemanding, in our opinion, as we forecast adj. EBIT growth of 25% YOY in 2025. We reiterate our HOLD, an...
- Joachim Gunell
Mycronic (Buy, TP: SEK500.00) - Build position at these levels
Mycronic’s 6% MF consensus EBIT beat in Q1 was overshadowed by its lower 2025 sales guidance, which we believe bakes in prudence. We consider the recent pullback in the stock a reinforced buying opportunity as we like its: 1) durable secular demand from advanced electronics, semiconductors, AI and reshoring; 2) deep competitive moats from strategic cutting-edge technology; 3) large share of defensive aftermarket sales; 4) strong balance sheet and proven M&A track record; and 5) attractive valuat...
- Joachim Gunell
Nokia (Buy, TP: EUR5.10) - One-off blew momentum off course
Nokia’s stock traded down 11% despite fairly in-line underlying Q1 results. We do not believe its repeated 2025 EBIT guidance looks conservative, as we have lowered our 2025e EBIT by 9% and have cut our target price to EUR5.1 (5.5). We reiterate our BUY, as we see: 1) accelerated earnings momentum, with adj. EBIT growth of 14% YOY for its core divisions in 2025e; 2) the data centre story should accelerate under its new CEO, potentially shifting the investor base from value- to growth-oriented, p...
- Joachim Gunell
HMS Networks (Buy, TP: SEK615.00) - Broad-based beat shows promise
Q1 was better than feared on: 1) an intact demand story, with orders beating Visible Alpha consensus by 8%; 2) an inflection point for earnings momentum, with adj. EPS growth for the first time in six quarters; 3) strong FCF easing balance sheet concerns; and 4) we believe it remains well placed for the next industrial automation upcycle and potential reshoring initiatives. We have raised our 2025e EBIT by 4% and our target price to SEK615 (600), and reiterate our BUY.
- Joachim Gunell
Ericsson (Hold, TP: SEK84.00) - 2025 could be a tale of two halves
Ericsson’s broad-based strength in its Q1 results and supportive Q2 guidance, undemanding valuation, and strong balance sheet could position it as a relative outperformer amid geopolitical uncertainty, in our view. That said, we see challenges mounting for H2e: 1) gross margin headwinds (key for its share price); 2) faded earnings and FCF momentum with -17% adj. EBITA and -32% FCF growth YOY in H2e; 3) low likelihood for share buybacks in 2025e, despite its over-capitalisation; and 4) potential ...
- Joachim Gunell
Yubico (Buy, TP: SEK275.00) - Second noisy quarter in a row
We see Yubico as a continued beneficiary in this heightened cybersecurity threat landscape. The short-term momentum of our thesis has come down amid tougher comparables and a higher burden of proof, while we expect soft Q1 results. For investors willing to look beyond the short-term noise, we believe most negatives are factored in (it is the fifth-most shorted stock on the Stockholm Main Market), and we expect it to reverse the bearish sentiment in 2025. We reiterate our BUY, but have cut our ta...
- Joachim Gunell
HMS Networks (Buy, TP: SEK600.00) - Recovery story is real, but gradua...
We view HMS Networks’ Q1 results as a likely inflection point for our 2025e earnings momentum story: 1) we forecast adj. EPS growth of 72% YOY; 2) we are above Visible Alpha consensus for Q1e orders by 4% and EBIT by 11%; 3) we expect strong cash flows to de-lever the balance sheet; and 4) it remains well positioned for the next industrial automation upcycle and potential re-shoring initiatives, in our view. Having lowered our 2025e EBIT by 7% to factor in FX headwinds, we reiterate our BUY, but...
- Joachim Gunell
Storytel (Hold, TP: SEK96.00) - A story on pause
We continue to see a neutral risk/reward ahead of Storytel’s Q1 results and strategy update in May, as expectations have crept up with recent share price gains. Its step-change in profitability and cash flows is mainly explained by gross-margin expansion, and limited low-hanging fruit remains, in our view. Thus, we see less upside potential for meaningful consensus revisions to propel the stock higher. Valuation is undemanding, as we forecast EPS growth of 32% YOY in 2025. We reiterate our HOLD ...
- Joachim Gunell
Fortnox (No_rec, TP: SEK) - Recommendation and target price withdrawn
This morning, EQT X and First Kraft (Olof Hallrup, Fortnox’s chairman of the board, who owns 18.9% of the shares) announced a take-private offer for Fortnox at SEK90/share or SEK58bn (38% premium to the last close, 13% premium to its recent highs in February). Fortnox’s board of directors recommends the bid, and the consortium said the deal is “best and final” (the consortium will not raise the price), corresponding to a 2025–2026e EV/EBIT of 47–35x and P/E of 61–46x on our numbers. The acceptan...
- Joachim Gunell
Ericsson (Hold, TP: SEK84.00) - Gross margin cracks start to form
We expect Q1 adj. EBITA to beat Infront consensus by 10%. However, Ericsson’s challenges for 2025e are mounting: 1) gross margin headwinds (key for its share price); 2) faded earnings and FCF momentum with -2% adj. EBITA and -40% FCF growth YOY forecasts after a strong 2024; 3) a low likelihood of share buybacks in 2025, despite its overcapitalisation; and 4) the potential CEO succession could create a wait-and-see scenario. We have lowered our 2025e adj. EPS by 18% (mainly FX) and reiterate our...
- Joachim Gunell
Nokia (Buy, TP: EUR5.50) - Outperformance has staying power
We expect Nokia to beat Infront consensus adj. EBIT by 13% in its seasonally smaller Q1e. We reiterate our BUY, have raised our target price to EUR5.5 (5.4) as we have included Infinera in our numbers, and calibrated our estimates for FX headwinds. We see: 1) accelerated earnings momentum, with adj. EBIT growth of 18% YOY for its core divisions in 2025e; 2) the data centre story should accelerate under its new CEO, potentially shifting the investor base from value- to growth-oriented, providing ...
- Joachim Gunell
Hexagon (Buy, TP: SEK137.00) - Multifaceted 2025 story unfolding
After recent market volatility, we see upside potential due to: 1) a long-awaited acceleration in organic growth (with defensive traits); 2) earnings momentum translating into YOY adj. EPS growth of 17% in 2025e; 3) the ‘NewCo’ spinoff (c25% of group EBIT) crystallising values; 4) new leadership appealing to a broader international investor base; 5) strong Q4 results that encouraged bulls and de-risked the 2025e case, potentially attracting new investors; and 6) undemanding valuation, in our opi...
- Joachim Gunell
Mycronic - Initiation of coverage - Hardware is still eating the world
We believe Mycronic offers: 1) durable secular demand from advanced electronics, semiconductors, AI and re-shoring; 2) deep competitive moats from strategic cutting-edge technology; 3) a large share of defensive aftermarket sales; 4) a strong balance sheet and proven M&A track record; and 5) Atlas Copco-moulded management and an ownership base on which to piggyback. In our view, 2025e is de-risked but set to be an investment year with lacklustre EPS growth. We initiate coverage with a BUY and SE...
- Joachim Gunell
Fortnox (Buy, TP: SEK95.00) - Positive inflection in organic growth
The best way to sum up Fortnox’s solid Q4 results was 25% organic sales growth at a 46% OpFCF margin despite a recessionary backdrop. We believe recent price increases and a heightened monetisation focus de-risks our above-consensus view for 2025e, while improved macroeconomic conditions would lend further usage tailwinds. As we expect to see EBIT growth accelerate to 35–40% YOY in the coming quarters from 30% YOY in 2024, the stock should re-rate, in our view, and we reiterate our BUY. We have ...
- Joachim Gunell
Yubico (Buy, TP: SEK310.00) - Strong conviction, and no cracks
The Q4 results included a couple of surprises, namely delivery of a large order slipping to Q1, which drove a headline miss, and the CFO’s departure. We admit the burden of proof has increased, but unlike short-sellers, do not see cracks starting to form, with: 1) a 5% bookings beat despite a tough YOY comparable de-risking 2025e growth and signalling that it remains a key beneficiary in this heightened threat landscape; 2) an underlying EBIT beat of 10–15% versus company-compiled consensus and ...
- Joachim Gunell
Storytel (Hold, TP: SEK96.00) - A story on hold
The Q4 results were strong across the board, and a solid gross margin again largely explained the recent profit step change; however, we believe there are few low-hanging fruit left. While we forecast 33% YOY growth in EPS in 2025 and the valuation remains undemanding, we see little likelihood of meaningful consensus revisions providing a catalyst other than multiples expansion, implying a modest risk/return. Storytel plans to unveil new medium-term targets in Q2; we believe they could be conser...
- Joachim Gunell
Hexagon (Buy, TP: SEK145.00) - Shaping up nicely
We see six potential drivers that could take the stock back to all-time highs in 2025: 1) long-awaited acceleration in organic growth; 2) earnings momentum translating into 21% adj. EPS growth YOY in 2025e; 3) the ‘NewCo’ spin-off (~20% of group EBIT) crystallising values; 4) Björn Rosengren as vice board chair and Anders Svensson as CEO appealing to a broader international investor base; 5) strong Q4 results encouraged bulls and de-risked the 2025e case, and could attract new investors; and 6) ...
- Joachim Gunell
Nokia (Buy, TP: EUR5.40) - Growth momentum starting to build
Sales trends are turning positive after six negative quarters. While Nokia’s adj. EBIT guidance for 2025 fell shy of Infront consensus, it has now de-risked the case, mainly driven by investments to strengthen the data centre growth outlook. We reiterate our BUY, have raised our target price to EUR5.4 (5.2), and lowered our adj. EBIT for 2025–2026e by 8–1%. We see: 1) accelerated earnings momentum, with adj. EBIT growth of 18% YOY for its core divisions in 2025e; 2) the data centre story potenti...
- Joachim Gunell
HMS Networks (Buy, TP: SEK630.00) - US cheer eases balance sheet fear
The Q4 results provided a strong start to our 2025e earnings momentum case: 1) 23% order beat to Visible Alpha consensus, as organic orders grew YOY for the first time in 10 quarters; 2) the disputed Red Lion acquisition shows promise for US growth; 3) margin resilience demonstrated its quality characteristics; and 4) cash flows were strong, and accelerated actions to de-risk the balance sheet. We gain more confidence in our 2025 forecast for 93% adj. EPS growth YOY. We have raised our 2025e EBI...
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