Rottneros (OM:RROS) - Share price, News & Analysis

RROS fundamental analysis
Snowflake Score
Valuation	5/6
Future Growth	0/6
Past Performance	2/6
Financial Health	5/6
Dividends	4/6

RROS Stock Overview

Rottneros AB (publ) produces and sells pulp worldwide.

Rewards

Trading at 29% below our estimate of its fair value

Became profitable this year

Risk Analysis

Earnings are forecast to decline by an average of 10.1% per year for the next 3 years

Unstable dividend track record

Rottneros Competitors

Price History & Performance

Summary of all time highs, changes and price drops for Rottneros
Historical stock prices
Current Share Price	kr12.32
52 Week High	kr16.42
52 Week Low	kr8.62
Beta	0.47
1 Month Change	-17.32%
3 Month Change	15.36%
1 Year Change	41.77%
3 Year Change	6.21%
5 Year Change	53.04%
Change since IPO	-38.40%

Recent News & Updates

Jun 09

Investors Will Want Rottneros' (STO:RROS) Growth In ROCE To Persist

There are a few key trends to look for if we want to identify the next multi-bagger. Ideally, a business will show two...

Shareholder Returns

	RROS	SE Forestry	SE Market
7D	-10.1%	-2.6%	-1.3%
1Y	41.8%	10.8%	-23.6%

Return vs Industry: RROS exceeded the Swedish Forestry industry which returned 10.8% over the past year.

Return vs Market: RROS exceeded the Swedish Market which returned -23.6% over the past year.

Price Volatility

Is RROS's price volatile compared to industry and market?
RROS volatility
RROS Average Weekly Movement	7.6%
Forestry Industry Average Movement	6.3%
Market Average Movement	7.4%
10% most volatile stocks in SE Market	12.2%
10% least volatile stocks in SE Market	4.7%

Stable Share Price: RROS is not significantly more volatile than the rest of Swedish stocks over the past 3 months, typically moving +/- 8% a week.

Volatility Over Time: RROS's weekly volatility (8%) has been stable over the past year.

About the Company

Founded	Employees	CEO	Website
1916	320	Lennart Eberleh	https://www.rottneros.com

Rottneros AB (publ) produces and sells pulp worldwide. It offers chemical and mechanical pulp for use in board and packaging, tissue, electrical, printing and writing, and filters applications, as well as customized solutions; and fibre trays. The company was incorporated in 1916 and is based in Vallvik, Sweden.

Rottneros Fundamentals Summary

How do Rottneros's earnings and revenue compare to its market cap?
RROS fundamental statistics
Market Cap	kr1.88b
Earnings (TTM)	kr307.00m
Revenue (TTM)	kr2.42b

6.1x

P/E Ratio

0.8x

P/S Ratio

Is RROS overvalued?

See Fair Value and valuation analysis

Earnings & Revenue

Key profitability statistics from the latest earnings report
RROS income statement (TTM)
Revenue	kr2.42b
Cost of Revenue	kr1.11b
Gross Profit	kr1.31b
Other Expenses	kr1.00b
Earnings	kr307.00m

Last Reported Earnings

Mar 31, 2022

Next Earnings Date

Jul 22, 2022

Earnings per share (EPS)	2.01
Gross Margin	54.03%
Net Profit Margin	12.68%
Debt/Equity Ratio	8.0%

How did RROS perform over the long term?

See historical performance and comparison

Dividends

4.9%

Current Dividend Yield

20%

Payout Ratio

We’ve recently updated our valuation analysis.

Valuation

Is RROS undervalued compared to its fair value, analyst forecasts and its price relative to the market?

Valuation Score

5/6

Valuation Score 5/6

Price-To-Earnings vs Peers
Price-To-Earnings vs Industry
Price-To-Earnings vs Fair Ratio
Below Fair Value
Significantly Below Fair Value
PEG Ratio

Key Valuation Metric

Which metric is best to use when looking at relative valuation for RROS?

Other financial metrics that can be useful for relative valuation.

The above table shows the n/a ratio for RROS. This is calculated by dividing RROS's market cap by their current preferred multiple.
What is RROS's n/a Ratio?
n/a Ratio	0x
n/a	n/a
Market Cap	kr1.88b

RROS key valuation metrics and ratios. From Price to Earnings, Price to Sales and Price to Book to Price to Earnings Growth Ratio, Enterprise Value and EBITDA.
Key Statistics
Enterprise Value/Revenue	0.8x
Enterprise Value/EBITDA	3.7x
PEG Ratio	-0.6x

Price to Earnings Ratio vs Peers

How does RROS's PE Ratio compare to its peers?

RROS PE Ratio vs Peers

The above table shows the PE ratio for RROS vs its peers. Here we also display the market cap and forecasted growth for additional consideration.
Company	PE	Estimated Growth	Market Cap
Peer Average	11.6x

Forward PE

Price-To-Earnings vs Peers: RROS is good value based on its Price-To-Earnings Ratio (6.1x) compared to the peer average (11.6x).

Price to Earnings Ratio vs Industry

How does RROS's PE Ratio compare vs other companies in the Forestry Industry?

Price-To-Earnings vs Industry: RROS is good value based on its Price-To-Earnings Ratio (6.1x) compared to the Swedish Forestry industry average (11.5x)

Price to Earnings Ratio vs Fair Ratio

What is RROS's PE Ratio compared to its Fair PE Ratio? This is the expected PE Ratio taking into account the company's forecast earnings growth, profit margins and other risk factors.

RROS PE Ratio vs Fair Ratio.
Fair Ratio
Current PE Ratio	6.1x
Fair PE Ratio	7.1x

Price-To-Earnings vs Fair Ratio: RROS is good value based on its Price-To-Earnings Ratio (6.1x) compared to the estimated Fair Price-To-Earnings Ratio (7.1x).

Share Price vs Fair Value

What is the Fair Price of RROS when looking at its future cash flows? For this estimate we use a Discounted Cash Flow model.

Below Fair Value: RROS (SEK12.32) is trading below our estimate of fair value (SEK17.34)

Significantly Below Fair Value: RROS is trading below fair value by more than 20%.

Price to Earnings Growth Ratio

PEG Ratio: RROS's earnings are forecast to decline next year, so we can't calculate its PEG ratio.

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Future Growth

How is Rottneros forecast to perform in the next 1 to 3 years based on estimates from 2 analysts?

Future Growth Score

0/6

Future Growth Score 0/6

Earnings vs Savings Rate
Earnings vs Market
High Growth Earnings
Revenue vs Market
High Growth Revenue
Future ROE

-10.1%

Forecasted annual earnings growth

Earnings and Revenue Growth Forecasts

Analyst Future Growth Forecasts

Earnings vs Savings Rate: RROS's earnings are forecast to decline over the next 3 years (-10.1% per year).

Earnings vs Market: RROS's earnings are forecast to decline over the next 3 years (-10.1% per year).

High Growth Earnings: RROS's earnings are forecast to decline over the next 3 years.

Revenue vs Market: RROS's revenue is expected to decline over the next 3 years (-0.8% per year).

High Growth Revenue: RROS's revenue is forecast to decline over the next 3 years (-0.8% per year).

Earnings per Share Growth Forecasts

Future Return on Equity

Future ROE: RROS's Return on Equity is forecast to be low in 3 years time (12.3%).

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Past Performance

How has Rottneros performed over the past 5 years?

Past Performance Score

2/6

Past Performance Score 2/6

Quality Earnings
Growing Profit Margin
Earnings Trend
Accelerating Growth
Earnings vs Industry
High ROE

-9.3%

Historical annual earnings growth

Earnings and Revenue History

Quality Earnings: RROS has high quality earnings.

Growing Profit Margin: RROS became profitable in the past.

Past Earnings Growth Analysis

Earnings Trend: RROS's earnings have declined by 9.3% per year over the past 5 years.

Accelerating Growth: RROS has become profitable in the last year, making the earnings growth rate difficult to compare to its 5-year average.

Earnings vs Industry: RROS has become profitable in the last year, making it difficult to compare its past year earnings growth to the Forestry industry (94.4%).

Return on Equity

High ROE: RROS's Return on Equity (18%) is considered low.

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Financial Health

How is Rottneros's financial position?

Financial Health Score

5/6

Financial Health Score 5/6

Short Term Liabilities
Long Term Liabilities
Debt Level
Reducing Debt
Debt Coverage
Interest Coverage

Financial Position Analysis

Short Term Liabilities: RROS's short term assets (SEK1.1B) exceed its short term liabilities (SEK485.0M).

Long Term Liabilities: RROS's short term assets (SEK1.1B) exceed its long term liabilities (SEK360.0M).

Debt to Equity History and Analysis

Debt Level: RROS's net debt to equity ratio (0.1%) is considered satisfactory.

Reducing Debt: RROS's debt to equity ratio has increased from 1.7% to 8% over the past 5 years.

Debt Coverage: RROS's debt is well covered by operating cash flow (201.5%).

Interest Coverage: RROS's interest payments on its debt are well covered by EBIT (21.8x coverage).

Balance Sheet

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Dividend

What is Rottneros's current dividend yield, its reliability and sustainability?

Dividend Score

4/6

Dividend Score 4/6

Notable Dividend
High Dividend
Stable Dividend
Growing Dividend
Earnings Coverage
Future Dividend Coverage

4.87%

Current Dividend Yield

Dividend Yield vs Market

Notable Dividend: RROS's dividend (4.87%) is higher than the bottom 25% of dividend payers in the Swedish market (1.67%).

High Dividend: RROS's dividend (4.87%) is low compared to the top 25% of dividend payers in the Swedish market (5.41%).

Stability and Growth of Payments

Stable Dividend: RROS's dividend payments have been volatile in the past 10 years.

Growing Dividend: RROS's dividend payments have increased over the past 10 years.

Earnings Payout to Shareholders

Earnings Coverage: With its low payout ratio (19.9%), RROS's dividend payments are well covered by earnings.

Cash Payout to Shareholders

Cash Flow Coverage: With its reasonable cash payout ratio (64%), RROS's dividend payments are covered by cash flows.

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Management

How experienced are the management team and are they aligned to shareholders interests?

3.2yrs

Average management tenure

CEO

Lennart Eberleh (52 yo)

5.75yrs

Tenure

kr5,676,000

Compensation

Mr. Lennart Eberleh has been Chief Executive Officer and President of Rottneros AB (publ) since September 1, 2016 and its Acting Managing Director for Rottneros Mill since October 18, 2017. Mr. Eberleh ser...

CEO Compensation Analysis

Compensation vs Market: Lennart's total compensation ($USD560.51K) is above average for companies of similar size in the Swedish market ($USD423.59K).

Compensation vs Earnings: Lennart's compensation has been consistent with company performance over the past year.

Leadership Team

Experienced Management: RROS's management team is considered experienced (3.2 years average tenure).

Board Members

Experienced Board: RROS's board of directors are considered experienced (3.3 years average tenure).

Ownership

Who are the major shareholders and have insiders been buying or selling?

Insider Trading Volume

Insider Buying: Insufficient data to determine if insiders have bought more shares than they have sold in the past 3 months.

Recent Insider Transactions

Ownership Breakdown

Dilution of Shares: Shareholders have not been meaningfully diluted in the past year.

Data	Last Updated (UTC time)
Company Analysis	2022/06/26 00:00
End of Day Share Price	2022/06/23 00:00
Earnings	2022/03/31
Annual Earnings	2021/12/31