In this financial analysis report, analysts Carl Tjernberg and Aulona Fetahu take a closer look at the Swedish book manufacturer ScandBook (SBOK). The analysts estimate a revenue CAGR of 4.2% in 2020A-2024E, with an EBIT margin expansion from 6.3% 2020A to 12.0% in 2024E. Despite having record-breaking earnings two years in a row ScandBook is traded at historically low levels during the pandemic, motivating a potential upside of 83.3%.
Investment highlights:
- By dominating the market and signing customers on multiple years’ deals, ScandBook is able to overcome the Nordic market’s decline.
- Niched production line and stamp of approval from working with big customers motivate further geographical expansion in Europe and North America.
- Undervalued assets, low debt levels, and solid cash flows, enable investments when needed.