Wilh. Wilhelmsen Holding Minor model adjustments

We have updated our estimates, owing to the Q1 report and our forecast revisions for Wallenius Wilhelmsen (WAWI). We still find the WAWI investment more than covers WWI’s current share price (112% of its market cap), and believe WAWI is sufficiently overcapitalised to propose up to NOK25/share in an extraordinary dividend on top of the ‘normal’ NOK10/share we expect in Q2. If so, WWI would be set to receive an impressive dividend equal to 33% of its market cap (NOK128/share). We do not consider ...

Yard response and dry bulk qualms

Our trip to South Korea and China revealed Chinese shipbuilders are seeking growth to take on Korea’s established yards who are facing constraints. An eagerness to add capacity is one of our takeaways, as well as a gloomy outlook for Chinese real estate, which in our view should inevitably weigh on dry bulk demand.

Evolution (Buy, TP: SEK1700.00) - Live buying opportunity

We reiterate our BUY and SEK1,700 target price after healthy but in-line Q1 results (Live revenue growth >25% YOY at constant FX). In our view, the weak share price despite a healthy start to the year, promising new games pipeline, high-conviction growth outlook (growth investments, e.g. recruitment), and long-awaited Live dealer contract with leading operator bet365 offers a solid buying opportunity.

Set for acceleration

Expansion investments weigh on Q1 margin, but great setup for solid outlook for remainder of '24e. Keep BUY — 17-14x '25e-'26e P/E and >5% FCF yield

Bet365 signing proving Evo's strength

Evolution (Buy, TP: SEK1700.00) - Continued strong start to 2024

According to our tracker, the positive trend that we identified in Q1 (stabilising YOY growth after a period of deceleration) has continued in Q2: total daily average players has grown by 10% QOQ, corresponding to >35% YOY. We believe the strong trend YTD implies upside potential to our forecasts and consensus for Q1–Q2 Live revenue growth of 6–4% QOQ. Evolution continues to widen the gap to competition and we believe stabilising Live revenue growth YOY should prompt a share price re-rating.

Evolution (Buy, TP: SEK1700.00) - Q1e revenue of EUR500m

We reiterate our BUY and SEK1,700 target price ahead of the Q1 results (due at 07:30 CET on 24 April). We see re-rating potential from e.g. stabilising Live revenue growth YOY (c25% YOY in Q1e at constant currency), confirmed by our proprietary tracker data, and an improving cash distribution story. Notable upcoming new Live game releases include ‘Lightning Storm’, which we believe is scheduled for late Q2.

Evolution (Buy, TP: SEK1700.00) - Flagging a trend shift

After two years of slowing growth in Live revenue and daily players (from very high levels), we see more encouraging trends YTD. According to our tracker, Evolution’s total daily average players are up 15% QOQ QTD (2–3% in Q3–Q4 2023), while YOY growth has stabilised at >30%. Our data also suggests that Evolution has maintained its superior market share, which, overall, increases our conviction in the growth outlook. We reiterate our BUY and SEK1,700 target price.

A brewing challenge for the yards

Our 17th Annual Energy & Shipping Conference was well attended by investors and industry executives showcasing the still-growing interest for the sectors. Limited yard capacity is fuelling high newbuilding prices and raising freight rate expectations for the vast fleet renewal necessary in the coming decade. Long lead times underpin a bullish supply story for much of shipping in the coming years, albeit exposed to geopolitical risks affecting trade patterns. Our overall impression was general op...

Golar LNG Minor model adjustments

We have updated our estimates, owing to the Q4 report. The company is progressing discussions for its next FLNG contracts, and we still find it well-placed to secure additional business that we believe is not currently reflected in the share price, which could prompt a re-rating. While we wait, we have made only minor adjustments to our estimates. We do not consider these changes to be material, and we have not changed our BUY recommendation. We reiterate our USD31 target price.

Golar LNG (Buy, TP: USD31.00) - Gimi ready, focus on project leads

Golar LNG is in the process of delivering Gimi for its 20-year contract with BP, and although the exact timing is still uncertain, the focus is turning towards what may be next. The company has not announced a fruitful FLNG project since 2018, which we view as a long-awaited potential catalyst to illustrate the value of its leading liquefaction offering. We reiterate our BUY, but have trimmed our target price to USD31 (32).

Wilh. Wilhelmsen Holding (Buy, TP: NOK555.00) - Cash should seep throu...

As we expect prosperous years ahead for car carrier shipping, we forecast strong, steady cash flow for Wilh. Wilhelmsen (WWI). Even after increasing our investment estimates, we arrive at a considerable overshoot that should find its way to investors at some point. We reiterate our BUY and have raised our target price to NOK555 (530).

Evolution (Buy, TP: SEK1700.00) - Stabilising Live growth is promising

In light of healthier Live revenue growth trends than we expected, promising signs of stabilising Live revenue growth YOY, and intact estimates, we have raised our target price to SEK1,700 and reiterate our BUY. In our view, more successful expansion (new studios and step-up in recruitment), new games development, and potential re-regulation in key markets (e.g. the US, Latin America) increase the likelihood of a re-rating this year.

Evolution (Buy, TP: SEK1640.00) - Needs to stabilise the Live growth

We expect Q4 Live revenue to be up 20% YOY with a 70.2% EBITDA margin, with stepped-up recruitment to face the rising demand. Next, management needs to prove that the Live revenue growth can stabilise and not decelerate more in 2024. With a credible plan, structural growth tailwind, market leadership, sizeable expansion and continued focus on the expansion of Live games, we reiterate our BUY and SEK1,640 target price.