ODDO BHF SECURITIES MORNING NEWS – DETAILED COMMENTS 11/05/2024

European equity markets weakened in October following multiple disappointments across the earnings season. The impending US election, the outcome of which is highly uncertain according to the polls, may also have prompted some traders to adopt a cautious stance. Sovereign long rates rose sharply, particularly in the US, on the back of macro indicators likely to provide arguments to the most hawkish of central bankers. All eyes are now on the November 5 elections and their repercussion...

ODDO BHF SECURITIES MORNING NEWS – COMMENTAIRES DETAILLES 05/11/2024

Les marchés actions européens ont fléchi en octobre après les nombreuses déceptions sur la saison des résultats. L’approche de l’élection US, très incertaine selon les sondages, pourrait également avoir poussé à la prudence certains opérateurs. Les taux longs souverains ont nettement remonté, en particulier aux Etats-Unis, sur la base d’indicateurs macro susceptibles de donner des arguments aux plus faucons des banquiers centraux. Tous les yeux sont désormais rivés sur le scrutin du 5...

Demant A/S : Q3 review – Factor in weakness in diagnostics

>Q3 review – slower organic growth - Demant’s Q3 revenues of DKK 5,401m (+0.0% y-o-y including, +4% y-o-y excluding communications) were driven by organic growth of 2% (vs ODDO BHF 1.9%, consensus 2.8%) and were 2%/0% vs ODDO BHF/consensus. Acquisitions contributed 200bp, while forex created a headwind of 100bp. No bottom line was reported on a quarterly basis.Hearing aids impacted by high base and competitive environment - Hearing aids sales of DKK ...

Q3 softer, but not as bad as we feared

Demant (Buy, TP: DKK330.00) - Lower end of 2024 guidance likely

In its Q3 trading update, Demant ended at organic revenue growth of c2% (below our forecast and consensus), owing to a soft performance in Hearing Aids and Diagnostics. The 2024 guidance was confirmed, but we find the lower end more likely. However, we note a historically high valuation gap between Demant and Sonova. We reiterate our BUY but have cut our target price to DKK330 (360).

Demant (Buy, TP: DKK360.00) - Company consensus added

Demant recently released company consensus for Q3. Our revenue forecast of DKK5,495m is c1.3% above consensus, and we expect organic revenue growth of 3.7% YOY (consensus 3.0%). In our view, consensus looks too pessimistic for Hearing Aids. We expect unchanged 2024 guidance for organic revenue growth of 2–4%, EBIT before special items of DKK4,300m–4,600m, and share buybacks of DKK2.3bn+. We reiterate our BUY and DKK360 target price.

Demant (Buy, TP: DKK360.00) - Managed care headwinds priced in

At the EUHA conference, Sonova’s launches were the key focus. While we are positive on the integration of AI technology, we question whether the larger size and lower battery time will be well received by customers. Demant focused on its latest DNN technology, which does not compromise on size or power management. For Q3, we are broadly in line with post-Q2 company consensus and expect an unchanged 2024 guidance. We reiterate our BUY, but have cut our target price to DKK360 (370).

EUHA shows Sphere is for real

Sphere of influence?

We cut FY'24 EBIT to DKK 4.2bn, 2% below low end of guidance. Marketing share-of-voice overshadowed by Sphere launch blitz. Cheap, and 2025 looks promising: HOLD, TP DKK 280 (300).

Weaker H2, but 2025 looks intriguing

Demant (Buy, TP: DKK370.00) - EPOS restructuring triggers one-off

Demant reported its H1 results (pre-announced) and confirmed its recently revised 2024 guidance. The key focus was the restructuring expenses of DKK400m triggering a one-off related to EPOS, prompting management to revise its guidance for the net loss from discontinued operations to DKK550m (including a cDKK50m net loss in CI). Demant guided for share buy-backs of DKK2.3bn+ (previously DKK2.0bn+). We reiterate our BUY and DKK370 target price.

ODDO BHF SECURITIES MORNING NEWS – DETAILED COMMENTS 08/15/2024

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ODDO BHF SECURITIES MORNING NEWS – COMMENTAIRES DETAILLES 15/08/2024

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Demant A/S : Hit by managed care, Communication harder to divest than ...

>Wholesale business impacted by managed care strategy - Demant released already preliminary Q2 results in July 2024, which were impacted by a weak development of hearing aids. In the second quarter, organic growth was only at 3% (total wholesale revenues, 2% organic growth with external customers) even though the company highlighted that its new flagship hearing aid series Oticon Intent has been received well at independent audiologists and performed in line with expe...

Demant (Buy, TP: DKK370.00) - Focus likely on managed care

With headline figures pre-announced on 16 July for Q2 organic revenue growth of c3% YOY and H1 EBIT before special items of DKK2,068m, we expect few surprises in the results. We also expect unchanged 2024 guidance for organic revenue growth of 2–4% and EBIT before special items of DKK4,300m–4,600m, and focus to be on the US brand strategy on the conference call. We reiterate our BUY and DKK370 target price.

ODDO BHF SECURITIES MORNING NEWS – COMMENTAIRES DETAILLES 17/07/2024

Après un parcours décevant (-21% depuis son entrée), nous décidons de prendre nos pertes sur Daimler Truck à l’occasion de la publication des résultats T2 où la société a décidé de passer une dépréciation de 120 M€ sur sa JV chinoise dans un « environnement de marché durablement faible » - ...

ODDO BHF SECURITIES MORNING NEWS – DETAILED COMMENTS 07/17/2024

After a disappointing performance (down 21% since the IPO), we have decided to take our losses on Daimler Truck following its Q2 2024 results release, in which the company decided to write down the value of its Chinese joint venture by € 120m in a ‘persistently weak market environment’. - ...

Market leadership can hurt

Cutting EBIT guidance by DKK 300m-400m. US Managed Care strategy hurts,; it's the cost of market leadership. We cut EPS ests. by 6-7%, TP DKK 300 (325) accordingly, HOLD.

Demant (Buy, TP: DKK370.00) - Managed care decisions hurt

H1 organic growth of 3% YOY and EBIT before special items of DKK2,068m were below our forecasts and consensus. Management issued a profit warning as it expects continued muted organic growth in Hearing Aids in H2, due to its chosen managed care brand strategy. As a result, the 2024 guidance was cut to organic growth of 2–4% (previously 4–8%) and EBIT before special items to DKK4,300m–4,600m (DKK4,600m–5,000m). We reiterate our BUY but have cut our target price to DKK370 (400).

Demant A/S : Managed care strategy has created higher collateral damag...

>Wholesale business impacted by managed care strategy - Demant released preliminary Q2 results, which were impacted by a weak development of hearing aids. In the second quarter, organic growth was only at 2% despite the company highlighted that its new flagship hearing aid series Oticon Intent has been received well at independent audiologists and performed in line with expectations. Earlier this year, the company opted for repositioning of its brand and deliberately ...