Sales recovery and cost cuts ahead

Q3 results slightly better than feared, new cost savings

Profit warning points to a soft Q3

US consumers gearing up to spend in 2025

Greener grass next year: upgrade to BUY (Hold)

Husqvarna (Sell, TP: SEK53.00) - Competitive pressure mounting

Following Tuesday’s Q3 profit warning, we see sales and EBIT coming under further pressure from weaker-for-longer consumer demand and increased competitive pressure, particularly from Chinese peers. We reiterate our SELL and have cut our target price to SEK53 (63).

Q3 profit warning

Husqvarna AB: 1 director

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Husqvarna (Sell, TP: SEK63.00) - Pressure mounting

We believe Q2 headwinds including continued weak end-market demand, lower production volumes YOY, and increased competition within consumer robotics will linger in H2. We expect organic growth and earnings to remain under pressure in 2024, we reiterate our SELL and have reduced our target price to SEK63 (65).

Too early to beg for good weather

-6% org. growth was 4pp short of our estimates. Consumer robotics decreased but pro grew strongly, as expected. '24e-'26e EBIT cut by 15-6%, TP down to SEK 82 (86): HOLD.

Q2 results well below expectations

Q2 preview: flattish earnings expected

A warm but rainy Europe and heat waves in the US. Tough comps for consumer robotics in Q2'24e. We reiterate HOLD at ~13.3x adj. EV/EBIT('24e).

Husqvarna Minor model adjustments

We have updated our 2024 estimates, as we now forecast a lower magnitude of end-market headwinds for Q2 than previously expected. The results are due at approximately 07:00 CET on 18 July. We do not consider these changes to be material, and we have not changed our SELL recommendation. We have raised our target price to SEK65 (63).

Husqvarna (Sell, TP: SEK63.00) - Pressure persists

Continued weak end-market demand, lower production volumes, and a legacy-business exit weighed on sales and earnings in Q1. We expect organic growth and earnings to remain under pressure in 2024. Following the Q1 results, we reiterate our SELL and SEK63 target price.

Cautious optimism ahead of Q2

-11% org. growth, partly due to normalised robotics sales. We see good prospects for improvements in Q2'24e. Lacking short-term triggers for re-rating, we reiterate HOLD.

Q1 figures roughly in line

Husqvarna (Sell, TP: SEK63.00) - Tough Q1 expected

We forecast weak consumer demand, lower volumes, negative mix, high robotics comparables, and a partial exit from its combustion engine business (worth cSEK750m of sales) to weigh on sales and EBIT in Q1, with market dynamics and a consumer environment similar to H2 2023. We forecast a Q1 sales decline of 9% YOY and an adj. EBIT margin of 11.4%, down 260bp YOY. We reiterate our SELL and SEK63 target price.

Husqvarna (Sell, TP: SEK63.00) - Under pressure

We reiterate our SELL and have lowered our target price to SEK63 (65), as we cannot extrapolate Q4’s strong growth in professional robotics into 2024, weak consumer demand and macroeconomic headwinds should weigh on sales and earnings in H1, and longer-term we remain cautious on the impact of the transition to electrification on margins.

Husqvarna Minor model adjustments

We have updated our estimates, owing to updated FX, minor adjustments to our adj. EBIT assumptions and one-offs in Q4 2023 (results due at c07:00 CET on 2 February). We do not consider these changes to be material, and we have not changed our SELL recommendation. We reiterate our SEK65 target price.

Husqvarna (Sell, TP: SEK65.00) - Weak Q4e

We expect weak demand to weigh on sales and EBIT in Q4, with similar market dynamics as in Q3 and consumers still under pressure. We forecast Q4 sales growth of -17% YOY on organic growth of -16% YOY due to lower volumes, and negative mix effects. These factors should also weigh on profitability; we estimate a Q4 adj. EBIT margin of -4%. We reiterate our SELL but have raised our target price to SEK65 (60) on a marginally more positive outlook.