* We leave our estimates broadly unchanged
* We expect 31% EBIT growth and strong cash flow in Q4
* 9.6-8.0x EBIT '27e-'28e; net cash position allows for buybacks
Limited estimate changes despite strong numbers
NYAB delivered another strong report, with sales increasing 27% y-o-y, all of which was organic growth. EBIT increased 33% y-o-y, although part of the growth was driven by a swap revaluation; underlying EBIT still rose by ~20% y-o-y. While Civil Engineering margins improved in Sweden (8.4% from 7.8%), Finland was weaker (7.0% from 8.3%). Management clarified that the finalisation of low-margin projects impacted Finland negatively, while ramp-up costs for new larger orders (including the recent data centre projects) also weighed. These are temporary effects, however, and the higher margins on the new projects should show from H1'27. Consulting margins were also a bit lower than expected. With the Q3 earnings beat largely driven by the swap revaluation, and the outlook unchanged, we only make smaller revisions to our estimates, raising '26e-'28e sales 4-3% on the higher organic sales and order growth. We expect lower margins for Consulting to persist, resulting in EBIT +1%/0%+1%.
Positive momentum into seasonally strong Q4
In addition to the record order backlog in Q3 of EUR 874m, +116% y-o-y, there is EUR 200m of early-phase assignments that should turn into orders in the coming quarters. We also see potential for NYAB to win more data centre contracts near term. All in all, we expect that the current order backlog supports our EBIT growth expectations of 22% y-o-y F12m and that NYAB is positioned to continue growing earnings ~15-20% in 2028. Near term, we expect Q4 to be a strong quarter with 31% EBIT growth and strong FCF (>EUR 30m, ~200% of EBIT).
Final thoughts
The share is trading at 9.6-8.0x EV/EBIT on '27e-'28e (6-7% FCF yield). By 2028, we forecast a EUR 104m net cash position excl. leasing debt. This offers interesting optionality, including potential buybacks or M&A.