Ferronordic: A step in the right direction - Nordea

We increase 2026E-27E adj. EBIT by 6-7%, mainly owing to stronger performance in Germany – having reached near breakeven, versus SEK -40m in the comparison quarter. While sales came in lower than our expectations, we believe this is compensated by the healthy -8% y/y SG&A reduction,  supporting a ~340bp y/y adj. EBIT margin expansion to 3.5%. While demand in Ferronordic's sales territories was robust in Q3, with growth of ~10-15%, we believe some potential headwinds to a more pronounced recovery will remain in the near term – in the US mainly relating to tariff-induced gross margin pressure, in Germany to continued slow truck traffic. In any case, we find Ferronordic well-suited to capitalise on a prospective market recovery in 2026 – supporting a group adj. EBIT margin expansion to ~4% (1.8% in 2025E). The share is trading at ~12x 2026E adj. EV/EBIT, a 10% discount to peers. We derive a higher multiples-based fair value range of SEK 40-67 (24-49), due to an outsized revision impact from the current leverage (ND/EBITDA of 3.9x), corresponding to 2026E adj. EV/EBIT of 12-14x.