Solwers: Outlook brighter after a tough 2024 - Nordea
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Solwers had already released a profit warning for Q4 2024 and the full year on 1 February. Q4 EBIT was EUR 0.3m, burdened by changes in conditional purchasing prices, writedowns on doubtful receivables and preparation costs for the possible listing change. A lower billing rate and tough price competition burdened earnings in Q4. Solwers' order backlog, however, remains at a good level and the company sees signs of improving activity, although we do not expect a rebound until after H1. Following the Q4 report, we trim our top-line estimates by 2% for 2025-26 and cut our adjusted EBIT estimates by 13-15%. Consequently, our DCF- and peer-based fair value range declines to EUR 3.8-4.5 (4.3-5.1), which includes EUR 0.6 per share for the present value of unannounced acquisitions. We believe Solwers will continue its M&A-driven strategy; the company is about to expand into the Polish market, and we foresee further margin improvement potential once the market recovers in Solwers' operating countries. Marketing material commissioned by Solwers.