Qlosr: Well-positioned to face an important quarter - ABG

Minor estimate revisions Balance sheet in better shape than we expected Currently trading at 7.0-4.5x ’23e-’24e EV/EBITA Key takes from the Q3 report and estimate changes The report was in line with our estimates, as net sales came in at SEK 124.4m and adj. EBITA at SEK 2.4m. We therefore remain confident that the company has the potential to reach our Q4’22e sales and EBITA estimates of SEK 169m and SEK 19m. Considering that the performance in Q4’22e is contingent on the company securing some larger, important contracts, we cut our Q4e sales estimates by SEK 2m and the EBITA estimate by SEK 1m. Regarding the balance sheet, we were positively surprised by the cash position and have therefore reduced our Q4e net debt estimate by SEK 17m. Contract wins are key in Q4e A key metric to follow will be the contract value following the end of a quarter. At the end of Q3’22 the contract value amounted to SEK 312m. This will be indicative of the company’s growth trajectory as well as the achievable net sales. We are positively surprised by the relatively quick integration of the newly-acquired businesses as well as the eagerness to cross-sell early in the integration process. This bodes well for Qlosr’s prospects as a serial acquirer. Trading at 7.0-4.5x ’23e-’24e EV/EBITA The share is currently trading at 7.0-4.5x ’23e-’24e EV/EBITA on our revised estimates. We note that peers have historically traded in the range of 10-13x on f12m EV/EBITA, implying that Qlosr is currently trading 30-50% lower than the 5-year historical median for peers. That said, we maintain our fair value range of SEK 4-11 per share, given that the company is performing in line with its plan. Läs mer på ABG Sundal Collier