Ferronordic: Beginning to turn a corner - Nordea

We lower our 2025-26 sales estimates by 4%, mainly driven by Germany. We raise our 2025-26 adjusted EBIT estimates by 0-1%, however, owing to our expectation of a continued favourable operating environment in the US, which should support rental conversions and the gross margin (prompting us to lift our 2025 gross margin assumption by 50bp to 20.5%). Despite the lacklustre performance in Germany, we expect a return to growth there in 2025, thanks to easing comparisons and sequentially improving sales, supporting group organic growth of ~8% y/y. The share is currently trading at 2025E adjusted EV/EBIT of ~11x, a 5% premium to the international equipment distributor peer group median. We maintain our multiples-based valuation range of 8-12x 2025E adjusted EV/EBIT, which implies a higher fair value range of SEK 50-75 (45-68). Marketing material commissioned by Ferronordic.

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