Northern Lights

Axactor (Buy, TP: NOK50.00) - Growing into Finland

The Q3 results reflected an underlying improvement from significant growth in NPLs and REO stock, but were hampered the Q3 seasonal downturn. Net profit of EUR0.4m was largely in line with expectations. Following the significant expansion in operations, we expect Q4 to be the first quarter to show a considerable improvement in net profit after several quarters of a bottom line close to zero. We have made marginal changes to our 2019–2020e EPS, and reiterate our BUY and NOK50 target price.

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Axactor (Buy, TP: NOK50.00) - Ramping up

We expect Q3 net profit of NOK0.6m (results due at 07:00 on 30 October). Management has guided broadly flat results QOQ, with underlying growth in operations offset by seasonality due to the annual August getaway in southern Europe. We have reduced our 2019–2020e EPS by ~10% to reflect lower investments in Q3 than previously forecast, as well as raising our amortisation estimates somewhat. The 2018 Net profit estimate is reduced by EUR9m. We believe the investment case is gradually being de-ri...

Improving sales mix in H2

Axactor (Buy, TP: NOK50.00) - Set for scale benefits to materialise

The bottom line was only just in the black in Q2, given the uptick in revenues and but increased costs. We have reduced our 2018–2020e net profit by EUR6m–7m, while we see positive signs from the solid collection performance on NPLs (5% higher than its business case) and REOs (42% better than business case). With the EUR93m REOs financing coming in place, we estimate Axactor’s current capex capacity to be around EUR450m, which when put to use could help extract scale benefits and improve m...

Northern Lights

Axactor (Buy, TP: NOK50.00) - Set for growth in REO collections

We expect Axactor to report Q2 EBIT of NOK9.1m, on increasing collections of unsecured and REO portfolios. It signed a considerable amount of forward flow contracts in Q2, requiring future capex of close to ~EUR200m. Reported Q2 capex was however modest at EUR10m versus our EUR110m estimate, due to delayed collection versus our previous forecasts. This is the main reason we have cut our 2018e EPS by 29% and 2019e EPS by 16%. For 2020e, the timing effect is less important and our EPS is unchanged...

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Axactor (Buy, TP: NOK5.00) - Scale effects set to kick in

Axactor reported Q1 results somewhat softer than we and the market had anticipated. While EBIT of EUR4.8m missed our estimate of EUR6.4m, the growth in gross collections from REOs showed a significant uptick from EUR2.0m in the previous quarter to EUR8.7m in Q1. As the ERC has nearly doubled in the past six months, we expect considerable growth in collections and increased scale benefits going forward. We have reduced our 2019–2020 EPS estimates by 7%, mainly as a result of higher amortisation...

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Axactor (Buy, TP: NOK5.00) - REOs starting to have an impact

We expect Q1 EBIT of EUR6.4m, up 51% from EUR4.2m in Q4 2017, and a net loss of EUR0.3m, reflecting one-off costs relating to the EUR150m bond issue. We have cut our 2018e EPS by 19%, mainly due to higher interest costs after the bond issue, but raised our 2019e EPS by 1% mainly due to high NPL acquisition activity (we estimate EUR90m) in Q1. We reiterate our BUY with a NOK5 target price, and see improved quarterly earnings through 2018 as Axactor builds scale providing a potential a share price...

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Axactor (Buy, TP: NOK5.00) - Wheels set to start turning in 2018

Axactor’s Q4 report showed a solid increase in revenues, with gross collection on its own NPLs up 57% QOQ, while higher than expected costs and some negative one-offs made the bottom line miss consensus expectations. We have updated our collection forecast with Axactor’s latest collection profile, which tilts collection towards year 2, and have thus cut our 2018e EPS by 9%, while our 2019e is raised 5% and 2020e is raised 4%. We reiterate our BUY recommendation and NOK5 target price and beli...

Northern Lights

Axactor (Buy, TP: NOK5.00) - A quarter of high NPL investment

We forecast Q4 net profit of EUR2.1 (up from EUR0.3 in Q3), driven by continued growth in gross collections and seasonality while the underlying cost base is largely stable (results due at 07:00 CET on 13 February). We expect portfolio acquisitions to total EUR195m given the announced acquisitions in Q4. We expect earnings to pick over the course of 2018 as collections on REOs portfolios start and Axactor achieves economies of scale from its ramp-up of operations. We have trimmed our 2018–2020...

AXA Equitable Life Insurance Company: Update following recent rating d...

FINANCIAL INSTITUTIONS CREDIT OPINION 17 November 2017 Update RATINGS AXA Equitable Life Insurance Company Domicile New York, New York, United States Long Term Rating A2 Type Insurance Financial Strength Outlook Stable Please see the  ratings section  at the end of this report for more information. The ratings and outlook shown reflect information as of the publication date. Contacts Mic

Moody's downgrades AXA Financial's ratings following AXA's continued p...

Rating Action: Moody's downgrades AXA Financial's ratings following AXA's continued pursuit of a partial IPO. Global Credit Research- 14 Nov 2017. New York, November 14, 2017-- Moody's Investors Service today has downgraded the insurance financial strength ratings of AXA Equitable Life Insurance Company and MONY Life Insurance Company of America to A2 from A1, and downgraded the senior unsecured debt rating of AXA Financial Inc. to Baa2 from Baa1 reflecting the removal of one...

Axactor (Buy, TP: NOK5.00) - Focus tilting towards secured debt

After investing ~EUR55m in secured and Real Estate Owned NPLs and guiding for further similar investments, Axactor is increasing diversification and shifting its focus to a new growth area. Management also used the Q3 presentation to highlight its view that the cost base is highly scalable, indicating potential for improved margins. The Q3 results were a little soft, driven by small misses at most P&L lines. We have made negligible changes to our 2018–2019e EPS, and keep our BUY recommendation...

SPV hits the ground running

Axactor reported Q3 results that were slightly below consensus expectations with a net profit of EUR0.3m, vs consensus at EUR1.3m and our estimate of EUR1.6m. The deviation was a result of somewhat weaker results on most revenue lines and slightly higher costs. However, we believe consensus 2018-2019 EPS estimate will be fairly unchanged on the back of the Q3 result, given the minor size of the miss. Axactor also announces a NPL acquisition in Spain with a purchasing price of around EUR60-70m, c...