Salmon stocks have now fallen too much, says Danske Bank

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Analyst Knut-Ivar Bakken upgrades the sector to Buy.

Salmon stocks have gained a lot of momentum on the stock exchange in the recent weeks. Although seafood is not hit the hardest by the indices on the Oslo Stock Exchange, the companies have had to endure a great correction.

Now Danske Bank’s financial analyst Knut-Ivar Bakken thinks it’s time to start buying the shares.

Source: Infront

He thinks short-term price effects of the corona virus will catch up quickly as the situation improves, and points out that prices are still high in the first quarter of 2020. Historically, a low price level of salmon has given increased home consumption of salmon in Europe, he writes in an analysis update according to TDN Direkt.

“While the majority of consumption in China is in restaurants and hotels, 70 percent of Europe’s consumption is at home. Historically, we have seen that fish farmers have effectively managed to find new markets, such as when Russia closed overnight in 2014. However, we are more concerned about the logistics and processing in the short term, as much of the salmon has been exported on passenger aircraft, while quarantine in several countries in Europe can reduce processing capacity,” he writes.

The Norwegian krone has depreciated sharply against the euro and the dollar, which is favourable for fish farmers who have the bulk of revenue in euro and dollar, Bakken points out.



AUSS  Buy        Buy              128      129
BAKKA Buy        Sell              570      598
GSF   Buy        Buy              158      164
LSG   Buy        Buy               74       75
MOWI  Buy        Hold              217      228
NRS   Buy        Hold              230      237
NTS   Buy        Buy               82       83
SALM  Buy        Hold              436      452