Handelsbanken has cut its target price on Leroy Seafood Group to NOK 47 from NOK 53, maintaining a Hold rating, citing downside risk to market dynamics and estimate revisions ahead of Q1 2026 results.
Analyst Erik Cederberg estimates Q1 operational EBIT of NOK 764 million, down 27% year-on-year, at a margin of 9.6% on sales. The decline is driven by the Farming segment, specifically Lerøy Central, where sea-lice treatments pushed farming costs higher.
Cederberg points to Norwegian supply data as the key variable. Export volumes ran 12% above year-ago levels for January through April. Feed consumption rose 5% year-on-year in Q1, smolt releases were up 3%, and mortality declined. The combination points toward gradual supply normalisation rather than the sharp correction previously expected.
Harvest-ready biomass increased over the year before falling back in April, adding further uncertainty to the supply outlook.
Leroy’s March Capital Markets Day outlined a pivot toward capital discipline, reduced capex intensity, and monetisation of shielding and process technology investments. Cederberg acknowledges the strategic direction but flags that the shielding programme remains in early deployment and its biological stability benefits have not yet been proven at scale.
The financial impact of these investments will not appear in near-term results, the analyst said.
Q1 2026 results and spot price developments will be the next tests of whether market dynamics improve enough to justify a more constructive view. Cederberg’s neutral stance holds until the risk/reward profile becomes more attractive.