Analysts Klas Danielsson and William Wiksell have investigated the outlooks for Novotek, which specialize in automation and IT solutions for the industrial sector. Through the acquisition of Kerrco Automation, Novotek is expanding  geographically, as well as gaining future growth and margin opportunities. Furthermore, as the management indicates a venture into cyber security, there are positive outlooks for further growth potential.

Through a peer valuation, the analysts have indicated a fair value of 31,4 SEK and a potential upside of 16,3 % as a base case for 2018E.

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Case summary: 

  • The acquisition of Kerrco Automation expand the business geographically
  •  Cyber security efforts open up for new growth opportunities.
  •  An FCF margin of 8.7% is expected to allow increased dividends for 2019
  •  Potential upside of 16.3% 2018E in a base-case

Novotek.front