Aspo: Target is to double group net sales by 2028 - Nordea

Aspo held a CMD event on 14 May. The company is heading for EUR 1bn in net sales in 2028 which is almost 100% above the last year. Telko and Leipurin segments will use acquisitions to support selected compounder strategy. Around 2/3 of money needed for growth investments of EUR 350-400m could come from operating cash flow. Aspo do not exclude the use of own shares to finance acquisitions but that is not seen as a primary tool. One possibility in the future could be even a demerge or a divestment of its segments. Aspo is a holding company why acquisitions and divestments are used for value creation.

In our view, capital allocation, divestments and investments are the true strengths of Aspo and give it its competitive edge. In a scenario where Aspo will reach EUR 1bn in net sales with EBIT margin of 7%, the share price could be EUR 9 by assuming EV/EBIT of 9x and net debt of EUR 330m. Full year guidance was changed from EBIT of EUR 30m-plus to EBITA of EUR 32m-plus in 2024 but market consensus estimates for 2024 could remain unchanged we believe.

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