Careium: Downgrades '24 outlook - ABG

FY'24 org. growth outlook downgraded...
...now expecting 5-10% org. growth (12-15%), and EBIT margin of 7.5-10%
Mid-point implies an EBIT ~10% below our current '24e


Market delays weighing on growth

Careium has downgraded its full-year growth outlook, going from expecting 12-15% organic growth previously, to now expect 5-10%. While the EBIT outlook of “increased EBIT” remains, Careium now expects a margin of 7.5-10% for the full year (ABGSCe 9.1% pre press release). Like we have discussed in previous reports, the UK's announcement in March of a two-year delay of the close-down of analogue telecommunications and Telia's delay of its close-down of 2G networks in Sweden is weighing on growth, and they were the main explaining factor to the downgrade according to the press release. We note that these are temporary in nature, assuming that the structural demand remains, so the delays could support future growth instead. However, there is no outlook for 2025 and onwards released, and as Careium expands its FY growth target range by 2pp with only 3.5 months left of the year, the short-term uncertainty is notable.

Länk till analysen i sin helhet: https://cr.abgsc.com/foretag/careium/Equity-research/2024/9/careium---downgrades-24-outlook-/