Following the Q1 2026 report, we have updated our investment case. Our updated investment case covers the key investment reasons and risks as well as valuation perspectives against a peer group of Space related peers.
The Q2 2025/26 results confirm Gabriel's continuing operations are resilient in a challenging market, though the headline is weighed down by a steeper-than-expected FurnMaster revenue decline. Management's decision to maintain full-year continuing operations guidance of revenue MDKK 510-550 and EBIT MDKK 40-55, despite a softer Q2 in Europe and Asia, signals confidence in a stronger H2 as investments in new key account managers begin generating returns. Gross margins remain strong and the balance sheet is in its best shape in years, supporting the ongoing share buyback programme. We maintain our recommendation of "Accumulate" with a adjusted target price of DKK 280 per share, though we revise group estimates lower primarily on FurnMaster.
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We have updated our investment case on ISS A/S following the Q1 2026 trading update. The company delivered solid momentum in Q1 2026 with organic growth of 7.4% and a more balanced growth mix across price, volume, net new wins, and projects, which supports the 2026 guidance of organic growth above 5%, operating margin above 5%, and underlying free cash flow above DKK 2.7bn (and DKK 3.1bn if the Deutsche Telekom case is successful).
While the headline miss was meaningful, in our view the underlying read was more constructive than the print suggested, supported by very strong order intake and a record-high Civil Engineering order backlog
We believe Metacon started the year on a solid footing, driven by increased execution of its order backlog and an improved operating loss. While we view these developments as clear positives for the quarter, we continue to place significant emphasis on order intake, as a steady flow of new contracts is essential for the company to ultimately achieve self-funded growth. Although the company provided improved visibility into its sales pipeline in connection with the Q1 report, indicating that activity levels remain strong, we have yet to see these discussions translate into concrete orders. As a result, we believe forecast risk remains elevated and have therefore adopted a more cautious stance in our near-term estimates. Nevertheless, this has a modest impact on our long-term estimates, and we therefore maintain our target price at SEK 0.40 per share. However, given the recent surge in the share price, we lower our recommendation to Accumulate (previously Buy). Overall, we still see an attractive risk/reward profile at current valuation levels, with expected returns exceeding our required return.
Talenom's Q1 result exceeded our expectations, particularly due to stronger-than-anticipated growth in Finland, but there is still much to do in international operations.
Sitowise's Q1 performance was generally in line with our expectations, though write-downs on Buildings projects slightly weakened the figures. We made no major changes to our estimates.
