Instalco AB (Buy, TP: SEK48.00) - Continued margin discipline

Q1 saw sales and EBITA just below consensus on slower growth, but with a maintained margin. Instalco’s technical consultants also had above-group margins, a significant improvement from 2023, which could be an early positive sign for late-cycle business. We reiterate our BUY, but have cut our 2024–2025e EBITA by 4–5% and our target price to SEK48 (52), as personnel cuts could hurt organic growth short-term.

Instalco AB (Buy, TP: SEK52.00) - Still-attractive valuation

We believe accelerating negative organic growth YOY is well-reflected in consensus and market expectations ahead of the Q1 results. Furthermore, 2024 could mark a trough year for EPS should interest rate cuts materialise and sector activity pick up towards end-2024. We believe the stock continues to show attractive risk/reward, and reiterate our BUY and SEK52 target price.

Instalco AB (Buy, TP: SEK52.00) - Strong cash generation in Q4

We believe Instalco’s Q4 achieved satisfactory results, with net sales and EBITA 2% and 3% above our estimate, respectively. The EBITA margin held up well YOY and cash flow was strong. We reiterate our BUY, and have raised our target price to SEK52 (48) after rolling our valuation into 2024–2025.

Instalco AB (Buy, TP: SEK48.00) - Expecting organic slowdown

We expect the softening Nordic construction market to have translated into negative organic growth YOY for Instalco after several strong years in a row. Even so, we believe the stock still offers an attractive risk/reward, and strong de-gearing capacity should support either continued M&A in 2024 or lower leverage. We reiterate our BUY and have raised our target price to SEK48 (46).

Instalco AB (Buy, TP: SEK50.00) - Slow market, attractive risk/reward

We expect Q3 to mark the last quarter this cycle with positive organic growth YOY, before turning negative in Q4e due to the softening Nordic construction market. The stock has underperformed the index since June, and we continue to see attractive risk/reward despite cutting our target price to SEK50 (60), and reiterate our BUY.

Instalco AB (Buy, TP: SEK60.00) - Installation in progress

Organic growth in Q2 was 6%, with net sales beating our estimate by 4%, while EBITA was in line, albeit at a slightly lower margin YOY. We remain positive on the long-term growth story and reiterate our BUY, but have cut our target price to SEK60 (65) to reflect slightly lower estimates.

Instalco AB (Buy, TP: SEK65.00) - Set for continued solid execution

We expect Instalco to have continued its growth in Q2, but at a slower pace than in Q1 due to the softening Nordic construction market and fewer closed acquisitions QOQ. Furthermore, the risk/reward still appears attractive following the recent share-price correction. We reiterate our BUY but have lowered our target price to SEK65 (68).

Northern Lights

Instalco AB (Buy, TP: SEK68.00) - Rolling up and rocking on

Q1 was strong, with organic growth of 13% YOY, beating consensus by 5% on net sales and 10% on EBITA. As Instalco continues to report robust growth in net sales and a solid order backlog, we believe there are good prospects for organic growth in Q2 as well. We reiterate our BUY and have raised our target price to SEK68 (60).

Instalco AB (Buy, TP: SEK60.00) - Set for a slower start to 2023

Following a strong Q4, Instalco has had an ambitious start to 2023 by adding cSEK1bn of acquired annual sales. However, we expect January to have started at a slower pace than previous years, potentially hitting Q1 margins. We reiterate our BUY and SEK60 target price.

Northern Lights

Instalco AB (Buy, TP: SEK60.00) - Continued roll-up momentum

Instalco reported a solid Q4, beating consensus net sales by 13% and EBITA by 18% on strong demand for installation services. We reiterate our BUY and have raised our target price to SEK60 (50) on raised estimates as a result of recently announced acquisitions, reflecting strong M&A momentum.

Northern Lights

Instalco AB - Initiation of coverage - Uniting nations through install...

Instalco is one of the leading Nordic technical installation services companies. Being positioned in an attractive segment with secular growth drivers, we view the name as a solid industrial roll-up case and relative beneficiary as customers act to mitigate energy usage. We initiate coverage with a BUY and SEK50 target price.

Instalco AB: 2 directors

Two Directors at Instalco AB bought/maiden bought 10,296 shares at between 44.600SEK and 46.198SEK. The significance rating of the trade was 53/100. Is that information sufficient for you to make an investment decision? This report gives details of those trades and adds context and analysis to them such that you can judge whether these trading decisions are ones worth following. Included in the report is a detailed share price chart which plots discretionary trades by all the company's directo...

Instalco - Installers needed to fix earnings leakage

4% EBITA beat but weaker FCF and higher gearing ’22e-’24e EBITA down 3-0%, EPS down 15-6% Too early to turn positive; HOLD, TP SEK 47 (50)

Instalco - 4% EBITA beat but weak FCF and high gearing

Sales +6%, adj. EBITA +4% vs. cons; negative FCF Cons EBITA estimates largely unchanged post-Q3 Not good enough, mid-single digit negative reaction likely

Sector Report - Stronger for longer

Down to HOLD (Buy), TP SEK 150 (165) Calendar Q3 (fiscal Q2) report on Thursday, 27 October

Instalco - Similar tailwinds, similar headwinds

Q3 report on Wednesday, 9 Nov, at 11:00 CET ‘22e-‘24e EBITA down 2-0%; 7% EBITA decline in ‘23e HOLD on potential installation weakness, TP SEK 50 (55)

Instalco - Positive H2’22 outlook at lunch meeting

No signs yet of weaker markets, positive on profitability Good cash conversion set to improve further in H2’22e HOLD on potential installation weakness in 2023