Electrolux (Sell, TP: SEK80.00) - Weak Q1 expected
We forecast similar demand and market dynamics in Q1 to Q4, with consumer downtrading, elevated promotional activity, lower volumes YOY, negative mix effects and price pressure, and weak consumer demand weighing on sales and EBIT for the quarter. We expect -9% sales growth (-8% organic) and an adj. EBIT margin of -2.7%, down 360bp YOY. We reiterate our SELL and SEK80 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.
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