Electrolux (Buy, TP: SEK160.00) - Resetting expectations
The past two years have been a roller-coaster ride for Electrolux and its shareholders. 2022 now seems to be a lost year, but the situation should improve in 2023 in our view. By then, retailers’ de-stocking should near its end while reduced costs, lower raw materials prices and improved mix should lead to more normalised profitability. Accordingly, Electrolux appears attractively valued at a 2023e EV/sales of 0.38x. We reiterate our BUY but have cut our target price to SEK160 (185).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.
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