Norva24 (Buy, TP: SEK37.00) - German project headache

The Q3 results were mixed, with German governance issues clouding an otherwise solid performance. Now excluding the prohibited Norwegian Vitec acquisition combined with the German project business challenges, we have cut our 2024–2026e EPS by 3–10% and our target price to SEK37 (39). We reiterate our BUY, still seeing solid potential for a ‘buy-and-build’ sector roll-up case in the fragmented European UIM service market.

October player activity stabilising

September: Pulp shipments -10% y-o-y

UPM (Buy, TP: EUR42.00) - Earnings growth and buybacks

Since UPM had pre-released Q3 EBIT and provided new Q4 guidance, the Q3 report included no real surprises. Still, we are encouraged by UPM’s focus on continuously reducing fixed costs. Based on improved volumes in combination with better prices for pulp and biofuels, we are confident UPM will show impressive earnings growth. Based on reduced 2025–2027e capex, we also expect strong free cash flow, leaving the balance sheet overcapitalised, and paving the way for buybacks on top of compelling divi...

Pulp is down and Wood is up

Q3 in-line with PW

Stora acquires a Finnish sawmill company

Evolution (Buy, TP: SEK1570.00) - Live casino resilience

We have raised our target price to SEK1,570 (1,550) and reiterate our BUY after signs of stabilising Live revenue growth (c20% YOY at constant FX) and delivery of mitigating factors for the capacity constraints in Georgia. We have fine-tuned our 2025e EPS and expect more execution of the cash distribution and EPS growth case. We are attracted to the expansion story, e.g. the upcoming studio launches in Brazil and the Philippines.

Impressive execution

Relief

Heads-up for report 24 October

UPM (Buy, TP: EUR42.00) - Still fit for growth and buybacks

Although we were surprised and disappointed by UPM’s 2024 profit warning, we remain confident that it will report strong earnings growth for 2025–2026. With incrementally higher profits from the new business in Uruguay and low 2025–2026e capex, we also expect strong free cash flow, leaving the balance sheet overcapitalised with 2025–2026e NIBD/EBITDA of 0.5–0.1x, paving the way for much-increased, value-accretive shareholder cash allocations. We reiterate our BUY but have cut our target price to...

PW and Q3: Wood is up, pulp is down

Patience shall be rewarded

In-depth: we launch our Evo player activity tracker update. Risk to consensus Q3 and '24 margin guidance, but market could discount even worse – keep BUY.

Evolution (Buy, TP: SEK1550.00) - Data needs to be explained

According to our tracker, Evolution’s daily average players dropped 9% QOQ in Q3. We struggle to fully understand the softness, although there could have been a slight negative effect from the temporary Union strike in the Tbilisi studio. On the positive side, MOM growth has returned in October (+4%) and the company should see volume support in H2 from a stronger Live game release schedule, among other things.

Wood is up and Pulp is down

Q3 preview

August: Pulp shipments -10% y-o-y

UPM (Buy, TP: EUR45.00) - Fit for growth and buybacks

UPM (UPM FH, Buy) - Fit for growth and buybacks (16 pages)

Evolution (Buy, TP: SEK1550.00) - Turn the page and let’s get to work

We reiterate our BUY, but have lowered our target price to SEK1,550 (1,600) on a 3% cut to our 2024e EBIT, reflecting temporarily reduced capacity of tables in Q3 in a key studio (union strike in Tbilisi). The share buybacks should continue in Q4, and focus shifting to 2025e should be positive for the equity story in our view, with a return to healthy EPS growth (nearly 20% YOY), and more tangible evidence of the much-improved capital allocation strategy.