Following the Q2 report, which was below our estimates, we opt to lower our sales assumptions by ~7% for ‘21e-‘23e, mainly driven by us adjusting our growth assumptions for Q3’21e. The majority of Moment’s operations were closed down in Q2, and the ones which have been able to operate have had limited operations. The Swedish government has established a gradual easing of lockdown measures, which started on 1 July, but given the current measures we think that Moment will be negatively pressured in Q3’21e as well. We also adjust the number of outstanding shares as a result of recent financing initiatives, which drives our EPS estimate revisions.
EV/EBIT of 17-10x ‘22e-’23e, new cost base could lift margins
Based on our updated estimates and at the current share price, Moment is trading at an EV/sales of 1.2-0.4x for ’21e-’23e, and an EV/EBIT of 17.3-10.4x for ’22e-’23e. In terms of ’22e, we don’t factor in any significant revenue improvement until Q4’21e, which will depend on whether the Swedish government’s current plan of gradually easing lockdown measures can be maintained. However, given Moment’s new and flexible cost base, we could see significant margin improvement in the years to come compared to historical levels.
