reports
- Simen Aas
Rusta (Buy, TP: SEK88.00) - Expansion optionality not priced in
We are below consensus on Q2e adj. EBIT. In this report, we also look at the optionality of a potential successful European expansion, which we believe has close to zero value in Rusta today. We reiterate our BUY and SEK88 target price as we continue to like the long-term equity case.
- Simen Aas
Rusta (Buy, TP: SEK88.00) - Store expansion could top target
Weak summer sales were offset by further gross margin gains in Q1 2024/25, with adj. EBITA 10% above our forecast. We like that Rusta is aiming for store growth at the top end of its guidance (or even above), and is well on its way to normalised gross margins of 44–45%. We reiterate our BUY and SEK88 target price.
- Simen Aas
Rusta (Buy, TP: SEK88.00) - Better than feared Q1 results
We consider this a positive report for Rusta, including adjusted EBITA 10% above our expectations, as a slightly softer sales trend was offset by a higher gross margin and lower opex. We expect consensus 2024/25e EBITA to come up c3% on the back of the report and believe a positive share price reaction is warranted.
- Simen Aas
Rusta (Buy, TP: SEK88.00) - Attractive entry point to solid long-term ...
We are cautious ahead of Rusta’s Q1 2024/25 report, as we expect a strong start to the quarter to be offset by a weaker June, and still-low sales of high-ticket items to hamper the near-term sales trend. However, with the share price down c26% since its peak in June, along with limited consensus changes in the period, we find the risk/reward attractive, with the stock trading at a 2024e P/E of c15x, supported by a 2024–2027e adj. EPS CAGR of c24%. We have upgraded to BUY (HOLD), but have cut our...
- Simen Aas
Rusta (Hold, TP: SEK90.00) - Increased focus on growth
The Q4 results were slightly better than we expected, following a very cold spring and the Tietoevry IT incident. Also, the strong start to the summer season and lower sourcing costs from Asia and Europe are set to offset recent headwinds on the freight side. Although we still like the long-term equity story, we find the stock fairly valued. We reiterate our HOLD, but have raised our target price to SEK90 (80) on higher estimates.
- Simen Aas
Rusta (Hold, TP: SEK80.00) - Good start to summer sales
We consider this a slightly positive report for Rusta, including Q4 figures in line on sales, but with a strong gross margin offsetting slightly higher costs. On current trading, it states that a late summer start means good sales momentum at strong gross margins has continued in May. We expect consensus EBIT to be up 2–4% on the report, but note that the shares have been strong into the figures.
- Simen Aas
Rusta (Hold, TP: SEK80.00) - A solid run, time to pause
We are cautious ahead of the Q4 report as we expect a likely weak ending to the quarter, reflecting the unfavourable weather in April and TietoEvry-related one-off costs denting its earnings growth YOY. Although we continue to like Rusta’s long-term equity story and believe the stock should trade at a premium to the wider Nordic broad-variety space (a c44–33% premium on its 2025–2026e P/E), we find it fairly valued following its c80% share price rally since the October IPO. Thus, we have downgra...
- Aurore Tigerschiöld
- Aurore Tigerschiöld
- Simen Aas
Rusta (Buy, TP: SEK83.00) -
Solid underlying trends persist Q3 was strong, with adj. EBITA 10% above our estimate, good momentum into the spring/summer season, and reiterated financial targets. Rusta maintains its strong price position versus Nordic peers, and Q3 marked the first quarter with positive sourcing benefits (from Asia), which are expected to be positive in the coming three quarters as well. With 16 stores in the pipeline over the next 12 months, we believe Rusta is well positioned for further growth. We reiter...
- Simen Aas
Rusta (Buy, TP: SEK80.00) - Strong Q3 despite IT issues
We consider this a positive report for Rusta, with better-than-forecast top-line growth and gross margins, and less of an impact from the TietoEvry hacking than expected incident, as well as entering spring with good momentum (well stocked stores and warehouse). We expect consensus 2024e adjusted EBITA to come up by c4–5% on the back of the report, and believe a positive share price reaction is warranted.
- Simen Aas
Rusta (Buy, TP: SEK80.00) - IT issues set to overshadow results
We are neutral ahead of Rusta’s fiscal Q3 report (due at 07:00 CET on 15 March), as we expect likely strong underlying figures to be overshadowed by IT issues. We believe the incident will be treated as a one-off and we still like the long-term equity story. We reiterate our BUY and have raised our target price to SEK80 (75), having rolled our valuation to 2024–2025e.
- Simen Aas
Rusta (Buy, TP: SEK75.00) - Firing on all cylinders
Rusta reported fiscal Q2 results significantly above our expectations, with a strong start to its Christmas sales, and reiterated its financial targets. We remain positive on earnings momentum and expect it to continue to outperform the market in Q3. We also highlight that Other Markets has reported black figures YTD. We reiterate our BUY and have raised our target price to SEK75 (56), mainly driven by higher estimates.
- Simen Aas
Rusta (Buy, TP: SEK56.00) - A solid first report
We consider this a positive report for Rusta, including figures significantly above our expectations. We expect c15–20% positive changes to consensus 2023e adj. EBITA on the back of the report and believe a positive share price reaction is warranted. Note that the shares had performed strongly into the figures.
- Simen Aas
Rusta - Initiation of coverage - Growth at a reasonable price
Having expanded its hard-discount retail concept outside its home market nine years ago, Rusta has become a Northern European discount champion. Its clear roadmap, and best-in-class store and product management, make it well placed for further growth in our view. We initiate coverage with a BUY and SEK56 target price.
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