We’re initiating coverage of Sweden-based Hexagon with a no moat rating and fair value estimate of SEK 108. Our fair value estimate implies a fiscal 2024 enterprise value/EBITDA multiple of 12.5 times and a P/E multiple of 20 times. At current levels, the shares look fairly valued.
Hexagon’s margins leads those of its peers with further improvements expected.
Overall, while historical acquisitions have been strategically sound, ROICs indicate price discipline has room for improvement.
|
Metric
|
HEXA B
|
NEM
|
SAND
|
|---|---|---|---|
Price/Earnings (Normalized) | 27.70 | 54.28 | 22.55 |
Price/Book Value | 2.70 | 12.40 | 3.08 |
Price/Sales | 5.23 | 11.32 | 2.31 |
Price/Cash Flow | 19.61 | 46.58 | 12.44 |
|
Metric
|
HEXA B
|
NEM
|
SAND
|
|---|---|---|---|
Quick Ratio | 0.65 | 1.05 | 0.82 |
Current Ratio | 0.89 | 1.12 | 1.62 |
Interest Coverage | 7.80 | 65.42 | 5.56 |
|
Metric
|
HEXA B
|
NEM
|
SAND
|
|---|---|---|---|
Return on Assets (Normalized) | 7.11% | 13.34% | 8.51% |
Return on Equity (Normalized) | 11.98% | 23.59% | 17.33% |
Return on Invested Capital (Normalized) | 9.39% | 19.80% | 12.40% |
|
Ticker
|
Name
|
Morningstar Rating for Stocks
|
Capital Allocation
|
Economic Moat
|
Market Cap
|
|---|---|---|---|---|---|
KYCCF
| Keyence Corp | — | Gzqf | $108.7 Bil | |
GRMN
| Garmin Ltd | Bfkbjjkw | Jsybrbw | $32.5 Bil | |
HXGBY
| Hexagon AB ADR | — | Tqmrm | $30.2 Bil | |
HXGBF
| Hexagon AB Class B | — | Vplw | $29.8 Bil | |
FTV
| Fortive Corp | Ncbnbqqdsv | Jgwzsv | $27.3 Bil | |
KEYS
| Keysight Technologies Inc | Nwwrcyhm | Fmgm | $26.3 Bil | |
TDY
| Teledyne Technologies Inc | — | Jrtbklw | $18.7 Bil | |
TRMB
| Trimble Inc | Hfhrjryf | Fgqqlr | $13.9 Bil | |
ST
| Sensata Technologies Holding PLC | Tmxfvclp | Tszrjsh | $6.4 Bil | |
VNT
| Vontier Corp Ordinary Shares | Qwxqrtnl | Yswjmp | $6.3 Bil |
