Jefferies starts SkiStar with 'buy' on strong position in resilient Scandinavian market

SkiStar AB

28/09/2022 10:30

** Jefferies initiates SkiStar  SKISb.ST  with "buy", as the
Swedish ski resort operator's strategic position in Scandinavia
and northern location make it more resilient to macro risks and
less vulnerable to climate change
    ** "History suggests that the Scandinavian alpine skiing
market is more resilient than other industries in tougher times"
- Jefferies
    ** The company has a 51% market share in Sweden and 29% in
Norway, where domestic ski participation rates are among the
top-ten highest in the world, the broker says
    ** SkiStar is also able to attract foreign visitors looking
for ski destinations with more reliable weather conditions, it
adds
    ** Jefferies expects SkiStar's return on capital employed
(ROCE) to reach pre-COVID levels thanks to its stronger earnings
profile post-pandemic and favourable operating momentum
    ** SkiStar should be able to maintain high dividend payout
ratios, the broker says, predicting a steady payout ratio of 60%
over 2022-2024
    ** It notes SkiStar trades at a 21% discount to its closest
peer, Vail Resorts  MTN.N , and sets its target price to SEK
145, implying a 35% upside to the current share price
 (Reporting by Marta Frackowiak)
 ((marta.frackowiak@thomsonreuters.com))