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Nelly Profitability has to wait - DNB

Nelly issued a profit warning for Q2 last week. Despite a higher gross margin and lower warehousing costs, operating profit has been decreasing in Q2, mainly due to lower revenues. Nelly expects sales growth to decline by a double-digit percentage and operating profit is expected to be negative or close to zero in Q2. Accordingly, we have reduced our 2022–2024e sales and EBIT, and in turn lowered our fair value to SEK15–25/share (35–45/share).

Nelly issued a profit warning for Q2 last week. Despite a higher gross margin and lower warehousing costs, operating profit has been decreasing in Q2, mainly due to lower revenues. Nelly expects sales growth to decline by a double-digit percentage and operating profit is expected to be negative or close to zero in Q2. Accordingly, we have reduced our 2022–2024e sales and EBIT, and in turn lowered our fair value to SEK15–25/share (35–45/share).
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