Autostore will be the ninth most valuable company on the Oslo Stock Exchange after losing NOK 146 million in the first half of the year. The eight on the top of the list earned an average of NOK 7.4 billion.
With a market capitalization of NOK 103 billion, Autostore would be Norway’s second largest ever listing on the stock exchange, surpassed only by Statoil’s listing at the time in 2001.
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“We consider the long-term growth prospects to be very good,” Lislott Lieden, head of equity management at Alecta Pensionsförsäkring, wrote to E24.
The Swedish pension manager is among four primary investors who will each buy shares of Autostore for $200 million, or NOK 6.9 billion in total.
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She asserts that the investment “is fully in line with our investment strategy, which is based on large, long-term investments in a select few global companies.”
Leiden describes the company as a “world leader” in “cube storage automation,” a solution that, among other things, allows for greater storage capacity.
Autostore creates automated storage and picking systems for warehouse owners and operators.
The company has a strong history of profitable growth and is well positioned in a market of continuous structural growth, above all online shopping, writes Leiden.
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Alfred Berg’s manager, Leif Ericsrud, is more skeptical of what he calls Autostore’s “new” pricing. He says that Alfred Berg’s fund dropped the IPO in the offer to investors.
– There is a very strong growth forecast, for a very long time, with very good margins.
—For our part, it turns out it’s not a risk/return relationship that we think is attractive, says Ericsrud.
Too high pricing
Autostore has gone through a decade of strong growth, a trend the company says will continue.
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The company’s value also rose rapidly.
As recently as April, the bot company was valued at NOK 65 billion when it bought Japan’s Softbank.
Consequently, prices rose sharply when the company is now listed for NOK 103 billion.
This makes Autostore the ninth most valuable company on the Oslo Stock Exchange.
However, it’s still a bit about average earnings next on the list.
- The eight most valuable companies generated an average after-tax profit of NOK 7.4 billion in the first half of the year, during which time Autostore had a loss of NOK 146 million.
- Autostore’s turnover was NOK 1.3 billion, while the average in the eight most valuable companies was NOK 69.4 billion.
- The average is pulled by Equinor in particular. The average turnover of the eight most valuable companies was NOK 40.8 billion, while the average profit was NOK 3.9 billion.
Growth can justify pricing
If Autostore’s expectations come true, there is a sharp jump in turnover. It is set to increase to $300 million this year and more than $500 million in 2022.
It’s not priced based on this year’s or next year’s earnings, but it’s priced as if it’s going to deliver good, high growth for many years to come, says Nordea chief investment officer Robert Ness.
The question is whether they will get that growth, then you can defend the prices, or if expectations are too high, he says.
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