Electrolux (Buy, TP: SEK240.00) - Always outnumbered, never outgunned
Electrolux continues to battle external headwinds; we expect FX and raw material costs totalling SEK775m YOY in Q3. Nonetheless, we see Electrolux continuing to perform well, and achieve close to 6% EBIT margins in 2018. Looking at 2019, we believe the group should be able to more than offset costs related to tariffs with further cost savings and improved price/mix. We have trimmed our target price to SEK240 (265) and reiterate BUY.AB Electrolux sells home appliance for households and businesses, with products such as refrigerators, dishwashers, washing machines, cookers, vacuum cleaners, air conditioners and small domestic appliances under brands such as Electrolux, AEG, Zanussi, Frigidaire and Electrolux Grand Cuisine. Co. has six segments: Major Appliances Europe, Middle East and Africa; Major Appliances North America; Major Appliances Latin America; Major Appliances Asia/Pacific; and Small Appliances, which comprise the products for consumer durables market; and Professional products. Co.'s professional products include food-service equipment for hotels, restaurants and institutions, as well as laundry equipment.
DNB Markets is the investment banking arm of DNB Bank ASA and is focused primarily on the Nordic region, as well as internationally on niches such as global shipping, energy and related services, and seafood. DNB Markets offers services in FICC, Equities and Investment Banking advisory from offices in Oslo, Stockholm, London, Singapore and New York. Equity research coverage is offered on c250 Nordic companies. DNB was ranked no.2 in Extel Nordic Research 2017. The DNB Markets’ Credit and FICC Macro & FX Research teams are repeatedly highly rated by Prospera Nordic Institutional Investor Surveys.
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