“Prices are expected to be high and Mowi has had less volatility in its earnings over time due to a broad geographical exposure, which has resulted in a lower concentration of challenging regions than many comparable companies. We therefore see less risk of cost challenges “, wrote Nordea Markets according to TDN Direkt.
The share is upgraded to purchase, with a cash flow-based fair value of NOK 250 per share.
Furthermore, the investment bank considers that Lerøy Seafood will be an “absolute winner” in 2022. Nordea Markets expects Lerøy to start delivering a lower cost in annual base terms from the second half of 2022, driven by improvements in both Lerøy Sjøtroll and Lerøy Midt.
With increased salmon prices, the estimate for operating profit in 2022-2023 will be adjusted upwards by seven per cent. The recommendation is upgraded to purchases from hold, with a price target of NOK 80.
The price target for Bakkafrost is downgraded to NOK 700, from NOK 750, with a repeated buy recommendation. The price target reflects a confidence in the company’s production target in 2026 of 150,000 tonnes and a successful turnaround in Scotland.
The price target for Grieg Seafood is raised to NOK 120, from NOK 110, with a repeated purchase recommendation.
Grieg Seafood looks set to achieve a volume growth of around 20 per cent in 2022, and is thus the leading game on volume growth among the brokerage’s analysis coverage of fish farmers.
“We see Grieg Seafood as a top choice in the sector for investors with a high risk appetite, as the company’s earnings per share have the highest sensitivity to salmon prices,” it said.
