Management seems upbeat about M&A potential We lower our ‘22e adj. EBITA estimate by 17% due to the estimate miss in the quarter and lowered margin assumptions for H2’22e. Management says CBTT will likely see some temporary pressure on the gross margin, as it cannot fully compensate extra costs with price increases. On the positive side, management highlights that it intends to increase the acquisition pace in the future, although it highlighted some difficulties in agreeing with sellers on price levels at the moment. Given the latter, combined with a ‘22e ND/EBITDA of 2.3x, we expect it will take until ’23 before dialogues with potential sellers converts into actual M&A. This provides an upside to our estimates since we do not include unannounced acquisitions in our forecast.
Trading at 11-7x ‘22e-‘24e EV/EBITA The share trades at 11-7x ‘22e-‘24e EV/EBITA on our updated estimates and we forecast a 24% ’21-‘24e adj. EBITA CAGR.
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