Nordea finds new Ambu targets encouraging and trustworthy

Having looked over the Danish medtech company’s pipeline, the bank sees ”an opportunity for a strong double-digit earnings growth in the medium to long term.” 
Photo: Ambu/pr
Photo: Ambu/pr
by marketwire, translated by daniel pedersen

Nordea is encouraged by Ambu’s strategic course for the coming five years, which was presented in details during the company’s capital markets day on Tuesday. 

With that backdrop, the bank maintains its positive ”buy” recommendation for Ambu stock with a share price target of DKK 130 (USD 18.8).

”With the recent strategy update, Ambu commits to long-term sustainable double-digit revenue growth and an EBIT margin guided by the industry standard, which we calculate to be around 15%,” Nordea writes in an analysis.

”The strategy update also points to a more focused and gradual approach to innovation and commercialization of the company’s products. After having looked through Ambu’s pipeline, we assess the company’s goals to be trustworthy, and we see an opportunity for a strong double-digit earnings growth in the medium to long term,” the bank note adds.

Ambu’s new financial targets include an EBIT margin before special items of over 10% over the next two years. Meanwhile, the margin should be 20% in 2027/2028.

Moreover, an average annual organic growth of around 10% over the next five years, up to the report in 2027/2028, split over 15–20% in Endoscopy Solutions and 2–4% in Anesthesia and Patient Monitoring, has been projected.

After fluctuations on Tuesday, Ambu trading closed with a loss of 1.2% to DKK 101.2 (USD 14.6).

A contributing factor to keeping the stock down was likely Ambu signaling a capital raise of up to 5% of share capital, or around DKK 1bn (USD 144.5m).

Leadership had previously said capital raises would be unnecessary.

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