Novozymes Q3 in line With Previously Released Numbers; Shares Fairly Valued

Wide-moat Novozymes reported third-quarter organic sales growth of 6% with an EBIT margin of 29.5%, in line with previously released expectations announced on Oct. 7. Guidance for 2022 was maintained except free cash flow was reduced to DKK 1.3 billion-DKK 1.7 billion from DKK 1.7 billion-DKK 2.1 billion due to the timing of capital expenditures for the construction of the advanced protein solutions production line. We don’t expect to make a material change to our DKK 375 fair value estimate. At current levels, the shares look fairly valued.