A promise for the future or… something else, here’s an analysis of Talenom.
We raise our recommendation for Talenom to Buy (previously Accumulate) and revise our target price to EUR 5.6 (previously EUR 6.0). Finland’s economic recovery does not seem to be on the expected path, which is why we have lowered our growth and earnings forecasts for the coming years by around 5%. However, we expect the company to be able to achieve significant profitability improvements in the coming years, especially in Sweden, as the benefits of implementing its own software become apparent. The valuation has come down to an attractive level (2025e EV/EBIT 15x) in line with the stock, although the risks have increased along with the sluggish development of the business.