Equity valuation of Grieg Seafood ASA

Abstract

Through a combination of intrinsic valuation and relative valuation, this thesis estimates Grieg Seafood ASA’s equity value as of May 6, 2024, and provides an estimated target price along with a final stock recommendation. By using a traditional DCF model and peer multiples, this thesis determines a target price of NOK 86.51 per share for Grieg Seafood, with a 50% weighting between the two approaches to capture both the company's business performance and the market's cyclicality. Despite historical challenges, such as lower margins compared to peers and liquidity risks, strategic investments in post-smolt initiatives, and successful harvests in Newfoundland in 2023, total harvest volume and margins are expected to increase over the next five years. Based on the DCF valuation, a target price of NOK 66.05 is estimated. However, the relative valuation suggests an implied share price of NOK 106.98. With a 50% weighting between the two approaches and the current share price of NOK 70.45 (as of May 6, 2024), this analysis suggests that the stock is undervalued. Therefore, a buy recommendation is provided.

Date of Award	25 Jun 2024
Original language	English
Awarding Institution	Universidade Católica Portuguesa
Supervisor	José Carlos Tudela Martins (Supervisor)