Ferroamp (Q3 Review): Targets met, generation shift takes a little longer - Redeye

Ferroamp’s Q3 report was broadly in line with our expectations, with net sales of SEK58.2m matching our estimate and operating cash flow positive for a second consecutive quarter. Reported EBITDA of SEK-5.2m was below our forecast, but the deviation was mainly explained by lower capitalised development work, which management attributes to holidays and a shift towards production start-up work that is not capitalised. With positive EBITDA in August, Ferroamp has now met both of its 2026 targets, and management sees good opportunities for positive EBITDA for the full Q4. However, the webcast indicated that the generation shift will take somewhat longer than previously communicated, with full margin effect now expected towards the end of 2027. We therefore lower our near-term gross margin and EBITDA assumptions, while a lower cost base partly offsets this in later years. Our Base Case is raised slightly to SEK2.8 (2.7), with a fair value range of SEK0.6–6.5 (0.5–6.3). Including our relative valuation, our combined Fair Value is SEK3.0 per share.