Heijmans (AO) | Buy | Capital markets day targets

Research evidence excerpt

Heijmans (AO) | Buy | Capital markets day targets

Heijmans Buy | Target Price: EUR100.00

Company description Management

Heijmans is one of the largest construction companies in the Netherlands and Ton Hillen, CEO

now operates solely domestically after divesting its international activities. The Gavin van Boekel, CFO

company has a broad and balanced portfolio spanning three segments: Living Key shareholders

(36% of revenue), Working (24%), and Connecting (40%), which together cover Free float 85.84%

residential and non-residential development, building services, technical Waterbird 8.40%

installations, infrastructure projects, and long-term maintenance activities. Chris Oomen 5.40%

JP Morgan Asset Management 5.39%

Investment case Valuation methodology

After a period of divestment and de-risking, Heijmans has Our target price of EUR 100 is based on the rounded average of:

emerged as a structurally stronger and more focused Dutch 1) DCF EUR105 based on WACC of 9.4%, terminal growth rate of

construction group active in residential, non-residential and +1.5% and terminal Adj. EBITDA (Heijmans definition) of 10.0%.

infrastructure development/maintenance. The company now 2) Average of a peer group multiple comparison NTM P/E and

operates with a disciplined strategy centred on selective EV/EBIT multiple.

tendering and contract quality, which has translated into Because of Heijmans' superior margins and earnings

superior margins versus peers. predictability we apply a 80/20 split between our DCF and peer

c.35% of revenues are recurring, improving earnings group comparison.

predictability and materially strengthening the group’s risk Risks to our rating

profile. A collapse in the housing market would significantly impact the