Well placed in the current environment
We believe that the recent weakness in the share price is a good opportunity to come in again, as we see an upside to the margin target of 2025 of 10 percent and and security in Tokmanni's high share of local purchases (about 75 percent) and joint purchases from Asia with Europris and ÖoB (approx. 15 percent) in the light of a challenging purchasing environment. Finally, we believe that low-cost companies will gain market share when the pressure on consumers' wallets increases as a result of rising inflation and rising electricity prices. We raise the recommendation to Buy (Keep) and repeat the target price of 26 EUR.
Important results
Tokmanni has gained significant market shares compared with Finnish retail after 2017. We expect a continuous overperformance (also regarding comparable sales). In addition, the company aims to open about six new stores per year and with a higher turnover per store. Two TEX stores were acquired at the end of June with approximately 40 percent higher sales per store. Furthermore, there may also be an opportunity for Tokmanni to invest in ÖoB (Sweden) together with Europris, which has an option to buy the remaining 80 percent. Tokmanni will report figures for the third quarter on Friday, October 29. We expect an EBIT of EUR 30 million (up by 26 percent on an annual basis), driven by a 5 percent increase in comparable sales and an improvement in the gross margin by 100 points measured as an annual rate.
Forecast review
We will increase EBIT 2021-2023 by 3-4 percent, which is a result of an approximately 1 percent increase in comparable sales.
Gtranslatella Keplerin 4%n arvoinen päivitys: https://www.swedbank-aktiellt.se/analyser/2021/10/25/tokmanni_group.csp
