Electrolux (Hold, TP: SEK210.00) - Will 2021 be a new 2010 or 2011?
Earnings volatility has reached a new level for Electrolux as it recorded by far the best quarter on record in Q3 following the loss in Q2. Visibility into 2021e is therefore extremely low. Will it be a year similar to 2009–2010, when pricing discipline and cost-savings boosted margins? Or like 2011, when EBIT margins collapsed due to price pressure and cost increases. We forecast a scenario closer to 2010 for now, but do not rule out a 2011 scenario, which is why we reiterate our HOLD and SEK210 target price.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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