Despite a lot of negativity already being priced in, we believe investors will shy away from this stock until the market stabilizes and the outlook for order intake returns. We see some ~15% downside to consensus 2021-22e EBITDA, and we argue that the earnings visibility is low (2021-22e contract coverage is 42% and 21%). We downgrade to Sell (Hold) and cut our target price to NOK 4.0 (8.5), which reflects a ~20% discount to the historical EV/EBITDA.
04 May 2020
Downgrade to Sell, worst is still ahead
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Downgrade to Sell, worst is still ahead
Despite a lot of negativity already being priced in, we believe investors will shy away from this stock until the market stabilizes and the outlook for order intake returns. We see some ~15% downside to consensus 2021-22e EBITDA, and we argue that the earnings visibility is low (2021-22e contract coverage is 42% and 21%). We downgrade to Sell (Hold) and cut our target price to NOK 4.0 (8.5), which reflects a ~20% discount to the historical EV/EBITDA.