It was a rollercoaster of a ride leading up to SAAB’s Capital Markets Day. Following the confirmation that SAAB and Boeing were awarded the T-X program from the U.S. Air Force the share price spiked to an all time high only to fall some twenty five percent after SAAB announced plans to raise six billion kronor through a rights offer. Given the capital raising is part of a plan to strengthen its ability to deliver upon large international contracts we view the long-term prospects favourably and we were curious if SAAB would comment specifically about any near, medium, or long-term plans at the Capital Markets Day.

As it turned out, we were in no such luck and Saab’s CEO, Hakan Buskhe was overall very conservative, yet optimistic, commenting that he sees a great deal of possibilities to do more on growth and reasoned that the restructuring announced in October was part of a greater plan to concentrate on opportunities that Saab have demonstrated an ability to take a lead on in an international way.

Saab have experienced exceptional growth over the past several years and it was pointed out that it was the small and medium sized orders that would continue to be increasingly important. While it wasn’t stated as such, it may be reasonable to assume that some of the larger sized contracts may not yield immediate rewards, but are longer-term strategic plays to further position Saab as a leading international supplier of world leading defence equipment while smaller and medium sized orders have a greater immediate reward.

The take away from Saab’s Capital Markets Day is the company is conservative yet convincing in its actions to position the company as a very strong defence player and we continue to believe the company is a great medium to long term investment.