Industrivärden, one of Sweden’s premier investment companies, is currently trading at a slight discount to its net asset value, hovering around 4%. Despite this, Handelsbanken, a leading Nordic bank, remains undeterred and has stamped the stock with a buy recommendation in the short term and an outperform rating in the long term.
The underlying portfolio of Industrivärden consists of a select few large publicly traded companies, which Handelsbanken believes justifies the low discount. What’s even more compelling is that 80% of the underlying portfolio value has outperform recommendations, showcasing the strength of Industrivärden’s holdings.
As a major shareholder in Handelsbanken itself, Industrivärden’s portfolio excludes its stake in the bank, with the other significant holding being construction giant Skanska. Handelsbanken’s analysts, led by Julia Angeli Strand, have a buy recommendation on 70% of the underlying portfolio value, reflecting their confidence in the company’s prospects.
Looking ahead to the next three years, Handelsbanken has set a target price of 538 kronor for Industrivärden, implying a total expected return of 45% over that period. This optimistic outlook underpins their outperform recommendation and underscores the potential for significant gains.
In addition to Industrivärden, Julia Angeli Strand has also conducted an analysis of Lundberg, another investment company giant. For Lundberg, the recommendation is to hold in the short term and outperform in the long term.
The current discount on Lundberg of approximately 10% stands out, as it is significantly higher than the recent three-year average of 5% and historically elevated. Handelsbanken sees this as a prime buying opportunity and has therefore raised their long-term recommendation on Lundberg to outperform. With a three-year target price of 735 kronor, the expected return of 43% further supports this bullish stance.
Overall, Handelsbanken’s thorough analysis and bullish recommendations on both Industrivärden and Lundberg highlight the potential for strong returns in the Swedish investment landscape. Investors would be wise to take note of these insights and consider the opportunities presented by these well-positioned companies.