* Q3 a bump in the road * Estimates down given more cautious view on activity pick-up * 2025e-'27e EV/EBIT of 4-7x with easy comps Q3 softer than expected Catella delivered a Q3 report below both ABGSC and Factset consensus expectations, with EBIT coming in at SEK 7m (19m) compared to ABGSCe of SEK +30m. The results were negatively impacted by both lower transaction-based revenues and weaker Corporate Finance. The company showcased solid cost discipline in Q3, but the quarter is a seasonally weaker from a transaction point of view. We are, however more optimistic about Q4e and expect to see stronger results q-o-q. The variable fees within Investment mgmt. remain subdued, but we expect transaction activity to gradually increase, which will drive bottom-line earnings growth in the coming quarters. AUM stood out positively in Q3, coming in at SEK 160bn, up 2% q-o-q (SEK 4bn), slightly above ABGSCe of +1%. A more cautious view on activity reduces our estimates Following the softer than expected Q3, we pencil in a slower recovery in variable fees vs. our previous assumption, leading us to cut our assumptions in both Corporate Finance and Investment Management. Despite lower estimates, we continue to forecast strong earnings growth in the coming years, with the help of market activity picking up. 2025e-'27e EV/EBIT of 4-7x with a 6-8% dividend yield Despite Q3 falling short of our expectations, the company has, in our view, many attractive fundamentals, including an impressive AUM growth track-record within Investment Management. The balance sheet remains strong, providing Catella with the necessary resources should the right opportunities arise. The comps are easy, and we believe the transaction activity outlook is promising. This means that we expect strong yearly earnings expansion from here. In addition, when applying our latest earnings revisions, Catella is trading at an EV/EBIT of 4-7x for 2025e-'27e and offers an appealing dividend yield of 6-8% p.a.
LÄS MER
