Norway: Updated traffic lights suggest lower growth

One step forward, one step back

Higher salmon prices as biology goes from bad to worse, but muted '24e EBIT impact; flipside is volumes down and costs up. The playing field is changing, but we remain sector BUYers.

Assumed risk too high

Q4'23e EBIT USD -6.8m (FactSet cons at USD 4.2m). We revise '24e EBIT down by 22% as we reset our coho estimates. In sum, the assumed risk is too high at a '24e P/E of 8x, and we stick to BUY.

Weaker outlook, but valuation support

‘23e-'24e EBIT (core) down on margins and volumes. Lowers growth ambitions amid softer demand but too much negativity priced in; BUY, TP of NOK 50.

Recent weakness offers a second chance

Market fundamentals look better than we feared, but sector is down 8% and consensus is now more aligned with us. We thus see improved risk/reward at '23e-24e P/E of 15-12x.

Temporary issues, strong outlook

Q3'23e EBIT USD 4.3m (FactSet cons at USD 10.5m). Our '23e/'24e EBIT is down 28%/3% on lower margins. Simply too cheap at '24e P/E of 6x.

Weak Q2, but set for recovery in Q3

‘23e-'24e EBIT (core) lower on weaker margins. Strong volume growth ahead, gaining market share in Chile. Discount too steep – '24e P/E of ~7x (peers at 12x).

Approaching the inflection point

Sector down 12% on weak spot-price sentiment since May. Some potential negative data points left, but set to turn in H2, and largely reflected with sector at '23e-'24e P/E of 15-12x. Our sector top-pick remains Mowi.

Playing the long game

Q2'23e EBIT USD 1.9m (FactSet cons at USD 7.7m). Our '23e/'24e EBIT is down 21%/8% on lower margins. Too cheap at '23e-'24e P/E of 7x-6x. BUY.

Flexibility paying off

‘23e-'24e EBIT (core) marginally lower on weaker margins. The return to profitability set to continue, which means it's too cheap to ignore at '23e P/E of ~7x (peer avg. ~15x).

Q1: EBIT 28% below a slim Factset cons

Valuation support, but sentiment set to cool

Shares and estimates continue to climb on high prices. Valuation support at '23-'24e P/E of 13-15x, but we see risk of weaker sentiment the next 6 months.

Still way too cheap

Q1'23e EBIT USD 21.1m. Our '23e-'24e EBIT is up 7-11% on improving margins. Out of the woods; unwarranted discount to Norwegian peers — BUY, TP NOK 72. .