Tomra slumps as souring recycling markets prompt Carnegie cut to 'sell'

Tomra Systems ASA

03/10/2023 11:35

** Shares in Tomra Systems  TOM.OL  drop 9% as Carnegie cuts
the Norwegian sustainable technology company to "sell," citing
souring recycling markets 
        ** "While many of the negative triggers in Tomra have
played out, one persists," it says and points to Recycling
demand in a slowing economy
  
    ** Consensus' expectations of 9–12% Recycling sales growth
in 2024–2025 seem optimistic to the brokerage 
    ** "Assuming an average quarterly order intake of NOK708m
during Q3(23e)–Q4(24e), which is 7% above H2(22) levels, we see
10% downside to consensus EPS(24e)"
    ** It adds that assuming a return to the Q4(22) run-rate,
the downside expands to 15%
    ** The brokerage cuts target price to NOK 94 from NOK 153 as
it expects falling momentum in the Recycling order intake in the
short-term to trigger a downward move in the share price
    ** Today's losses wiped off 3.3 billion Norwegian crowns
from company's market cap
    ** Tomra stock is on track for its worst day in a year and
among worst performers on pan-European STOXX 600 index  .STOXX 
    

 (Reporting by Jesus Calero)
 ((Jesus.calero@thomsonreuters.com))