NTG.CO — mttssn research

HOLD

Conviction: MEDIUM

An asset-light freight forwarder with an acquisitive model, but thin economic profit (ROIC ~9% ≈ WACC, +DKK 23M), negative current free cash flow, and a price embedding ~7.2% perpetual growth. Quality model, thin returns, fully valued. HOLD with a bearish lean.

Adj. ROIC

8.2%

WACC 8% → spread +0.2pp

Economic Profit

+DKK 9M

+DKK 23M; thin — ROIC ≈ WACC

FCF Yield

-0.0%

Negative LTM — watch

Price / Target

DKK 207 → DKK 195

-6% base; HOLD

Revenue (LTM)

DKK 11.7B

LTM; road/air/ocean forwarding

EBIT Margin

5.2%

GAAP; asset-light forwarder

EV / IC

1.68×

Enterprise value / invested capital

Net Debt

DKK 2.6B

DKK 2.4B

Thesis

NTG Nordic Transport Group is an asset-light freight-forwarding and logistics group (road, air & ocean) built through a buy-and-build acquisition strategy. The asset-light model has structurally high returns potential, but reported adjusted ROIC of ~9% only matches the 8% WACC, leaving thin economic profit (+DKK 23M).

The equity at DKK 209 embeds ~7.2% perpetual growth (reverse-DCF), with currently negative free cash flow (acquisitions/working capital). The model is sound, but current returns are thin and the valuation is full.

Valuation · reverse-DCF & scenarios

Bridging adjusted NOPAT through net debt, reverse-DCF fair value runs DKK 92–102 across scenarios — well below the DKK 209 price (~7.2% implied growth). The asset-light model deserves a premium, but thin current returns and negative FCF make the equity fully valued.

Base DKK 195 (−7%, modest de-rate); bull DKK 250 (freight-cycle recovery + accretive M&A lift returns); bear DKK 150 (freight-recession volumes and rate pressure).

Market-implied growth

≥7.8%

model ceiling — EV implies more than constant-ROIC sustains

No-growth value / share

DKK 85

41% of price; rest = priced-in growth

ROIC − WACC

+0.2 pp

ROIC 8.2% vs WACC 8.0% — positive = value creation

CAP (priced-in)

30.0 yrs

years of excess returns the price implies (fades to WACC)

At today’s enterprise value the constant-ROIC reverse-DCF maxes out: even at its sustainable-growth ceiling (~7.8%, limited by ROIC 8% ≈ WACC 8%) it cannot reach the current EV. No-growth value is DKK 85/share (41% of price); the market prices in growth and/or a higher ROIC than booked — richly valued on this lens. Read the sensitivity grid.

Scenario	24m target	Impl. g	Upside	Prob.	Driver
Bull	DKK 250	≥8%	+21%	30%	Freight-cycle recovery + accretive M&A
Base	DKK 195	≥8%	-6%	40%	Modest de-rate; thin spread, full growth
Bear	DKK 150	≥8%	-28%	30%	Freight-recession volumes + rate pressure
Prob-weighted	DKK 198	—	-4%	100%	Scenario-weighted expected value

Sensitivity — fair value / share at WACC × growth

WACC \ g	0%	3%	5%	8%	10%	15%
6.50%	154	166	175	187	195	213
7.25%	114	121	125	130	133	138
8.00% (base)	85	88	89	90	89	84
8.75%	63	63	62	59	56	44
9.50%	46	43	41	35	30	13

Green = fair value above the current price of DKK 207.00. The reverse-DCF conclusion is dominated by WACC and growth — see the whole surface, not a single fair value.

Method & data. NOPAT DKK 349, invested capital and ROIC 8.2% are observed (adjustments.json); WACC 8.0% and terminal g 2.5% are assumptions. EV→equity uses net debt DKK 2,584. The model holds ROIC constant (no fade) over the explicit horizon; the CAP figure instead fades excess returns to WACC.

⤓ Download the full model (.xlsx) — formula-driven sheets; flex the blue input cells and the model cascades in Excel.

Key drivers

1. Asset-light model

Freight forwarding needs little capital, with high return potential at scale.

2. Buy-and-build M&A

A disciplined acquisition strategy in fragmented Nordic/European forwarding.

3. Network effects

A growing forwarding network improves density and procurement.

4. Freight-cycle recovery

A recovery in freight volumes/rates would lift thin current returns — the bull path.

5. Entrepreneurial model

A decentralised, incentive-aligned operating model.

Key risks

Thin economic spreadROIC ≈ WACC with minimal economic profit and a full implied growth.
Negative free cash flowCurrent negative FCF (M&A/working capital) bears watching.
Freight cyclicalityForwarding volumes and gross-profit-per-shipment track the freight cycle.
M&A executionThe buy-and-build model depends on disciplined, accretive deals and integration.
Full valuationPrice embeds ~7.2% perpetual growth against thin returns.

Conclusion

NTG is a sound asset-light freight forwarder whose thin current returns and full implied growth, plus negative free cash flow, leave the equity fully valued. HOLD with a bearish lean, medium conviction; base target DKK 195 (−7%).

A freight-cycle recovery plus accretive M&A is the upside; thin economics and cash conversion are the principal cautions.