Investment Idea: Marine Harvest

Investment Idea: Marine Harvest

27 September 2017

Research of Swedish Handelsbanken reports higher salmon spot prices on Monday (25. September 2017). NASDAQ Salmon Index for weight classes higher than 6kg surges since five weeks. Weight classes lower than 6kg are almost unchanged in the same period.

According to research of Swedish Handelsbanken, salmon spot prices are reported at around NOK 51-52/kg on Monday (25, September 2017), up from NOK 49-50/kg. Fishpool contracts for FY 2018 are around NOK 62.3/kg. The growth conditions for salmon farming in Norway seem to improve.

The NASDAQ Salmon Index for weight classes higher than 6kg increases since five weeks, e.g. weight class 8-9kg increased about 10 Percent up to NOK 69.52/kg (week 37/2017). Weight classes lower than 6kg are almost unchanged in the same period.

Norwegian harvest volume continue to increase by reaching 26.300t last week which is an increase of nearly 2 Percent year-on-year over the last four weeks. The volumes are set to continue increasing.


Possible chances for Marine Harvest

Marine Harvest ASA is a Norwegian company primarily operative in the production and marketing of seafood. The Company acts within two segments, namely Feed and Farming. The Feed segment is responsible for production of fish feed. The Farming segment manages the Company's farming activities in Norway, Scotland, Canada, Chile, Ireland and the Faroe Islands.

The seafood industry represents one of Norway's largest export industries after oil and gas. Norway exports farmed and wild fish to more than 150 countries. The total volume for salmon in 2017 is expected to be 855.000 tons. Besides Marine Harvest, Leroy Seafood Group and SalMar are major players in the market.


Good half-year results in 2017

Marine Harvest reported solid half-year results. Adjusted revenue was up by 11,8 Percent to EUR 3.644 Million and adjusted operating income grew to EUR 1.924 Million. Adjusted EBITDA was up to EUR 1.199 Million with a margin of 21.1 Percent. Adjusted EPS grew by 65,4 Percent to EUR 1,34. Marine Harvest represents a market capitalization of EUR 8.242 Million. Analysts expect a twelve-month share price target of EUR 17,37. 9 Analysts value the stock with Buy, 4 with Hold and 4 with Sell.

Marine Harvest is expected to produce 403.000 tons fish in 2017, whereof around 242.000 tons of production come from Norway. During the first half of the year, Marine Harvest produced around 94.000 tons in Norway. Therefore, the company still has to produce around 148.000 tons in Norway to meet the anticipated expectations.



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26/11/2022 09:30:03