The Capital Goods Data Miner - May 2024

Our key long ideas are: Alfa Laval, Hexagon, Metso, Sandvik, Volvo. We are cautious on: Autoliv, Nibe, Wärtsilä

Valuation update

In this note, we show updated valuation statistics for the E&P sector.

US shale: limited growth expected

Our Q1 survey of the US shale universe showed limited revisions to guidance for 2024, and we still expect muted 2024 production growth of ~4% YOY (+8% YOY in 2023). The companies now expect fewer tailwinds from cost deflation, primarily due to operational efficiencies. Our survey also suggested capex down ~2% YOY, as companies guide for flat activity. For Q1, our universe spent 102% of its operating cash flow, split c50/50 capex and shareholder distributions.

Weekly news, topics & discussion

Key takeaways from this week are: 1) BlueNord’s Q1 figures were in line with our estimates, and due to technical issues, the Tyra plateau ramp-up was prolonged to mid-Q4 (2024 production guidance reduced from >40kboed to ~35kboed); 2) DNO’s Q1 report showed net production slightly above consensus, and it announced it has acquired stakes in five fields in the Norne area from Vår Energi, adding ~3kboed of net production near-term; and 3) Panoro Energy’s Q1 trading update showed net production of 9...

Valuation update

In this note, we show updated valuation statistics for the E&P sector.

Weekly news, topics & discussion

This week, we published a note on Aker BP highlighting our growing concerns of sharp cuts to consensus FCF, with capex assumptions beyond 2026 looking far too low to us – we are ~40% below consensus on 2027–2030e FCF. As well as BW Energy’s Q1 trading update revealing net production just below our estimate, it announced a sale & leaseback agreement, which we see as marginally accretive to our NAV. In other news, we believe the Tyra ramp-up will be in focus in BlueNord’s Q1 results, due next week

Q1 trends, estimates, valuation and top picks

The Q1 reports proved that sector companies could maintain record-high margins despite volume declines.

Temporary setback in Q1

Larger than expected impact from AOP in Q1 putting temporary pressure on growth and margins. Growth case intact, BUY and TP of SEK 34 unchanged.

Vimian (Buy, TP: SEK40.00) - Soft start, but successful issue

Q1 sales and earnings disappointed, largely explained by Medtech (negative annual ordering programme (AOP) effects) and one-off costs. With the oversubscribed SEK1.63bn rights issue completed, Vimian has financing to execute on M&A opportunities near-term. We reinstate a recommendation with a BUY and SEK40 target price.

Miss on earnings due to MedTech

Garmin Q1: 24% growth in Wearables

Valuation update

In this note, we show updated valuation statistics for the E&P sector.

Logitech: higher demand, low inventory

Weekly news, topics & discussion

This week, Equinor, Aker BP and Vår Energi released their Q1 results. In short: Equinor reported on the strong side, with a solid FCF beat fuelled by a working capital tailwind. Aker BP had a solid Q1 all around, while there was limited new news on Johan Sverdrup. For Vår Energi, with the results in line with our expectations, we believe investor focus remains on the Jotun FPSO sail-away.

ODDO BHF SECURITIES MORNING NEWS – DETAILED COMMENTS 04/26/2024

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ODDO BHF SECURITIES MORNING NEWS – COMMENTAIRES DETAILLES 26/04/2024

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Metso : Progress on margin reflected with resilience in Q1

>Q1 2024 orders in line but margin below expectations - Metso reported its Q1 2024 results yesterday morning (see first take). They were in line with expectations on order intake, but below expectations on adjusted EBITA (-7%).Order intake was down -6% on an organic basis (consensus -5.8%), but up 10.5% sequentially, confirming the rebound in activity that the group was anticipating in the Aggregates division (particularly in the US). Sales were down -7% on ...

AUCTUS ON FRIDAY - 26/04/2024

AUCTUS PUBLICATIONS ________________________________________ ADX Energy (ADX AU)C; target price of A$1.00 per share: Important step to unlock Sicily – The Italian ministry has informed ADX that it will be granted the d 363C.R-.AX gas exploration permit in the Sicily Channel. In addition, the Regional Administrative Court of Rome has annulled the Plan for the Sustainable Energy Transition of Eligible Areas that prevented the oil redevelopment, appraisal and exploration activities on the licence. ...

OKEA (Hold, TP: NOK28.00) - Limited free cash flow until 2027e

Underlying Q1 EBITDA was c6% below our estimate due to higher-than-expected production costs. Following the sanctioning of Bestla, 2024 capex guidance was raised by ~13%, and we expect the development to add >NOK2bn in incremental capex for 2025–2027. Hence, elevated capex will weigh on cash flow, likely leaving FCF negative overall in 2024–2026e. A risk of continued impairments to technical goodwill could also hamper OKEA’s dividend capacity, as distributions are limited to a certain portion of...

Metso : Les progrès sur la marge se ressentent avec sa résilience au T...

>T1 2024 avec des commandes en ligne mais en dessous des attentes sur la marge - Metso a publié hier matin ses résultats T1 2024 (voir first take) qui étaient en ligne avec les attentes sur les prises de commandes, mais en dessous sur l’EBITA ajusté (-7%).Les prises de commandes étaient en recul de -6% en organique (css à -5.8%), mais en hausse séquentielle de 10.5%, confirmant ainsi le rebond de l’activité qui avait été anticipé par le groupe dans la division A...