Q1 trends, estimates, valuation and top picks

The Q1 reports proved that sector companies could maintain record-high margins despite volume declines.

Reassuring price comments from Timken

ODDO BHF Small & MIDCAP MORNING NEWS - 30/04/2024 Date Performance dep...

L’offre de BHP sur Anglo American a confirmé l’intérêt des minières pour le cuivre dans un contexte de tensions croissantes sur la production et de difficultés à faire aboutir les projets. Les perspectives d’Anglo (Neutre) dans le cuivre sont désormais mieux valorisées, c’est aussi le cas de BHP (Neutre vs Sous-performance) mais pas encore assez, selon nous, sur Rio Tinto (Surperformance vs Neutre). En aval, Nexans et Montana Aerospace sont nos valeurs préférées (Surperformance) vs Au...

ODDO BHF Small & MIDCAP MORNING NEWS - 04/30/2024

BHP's bid for Anglo American has confirmed interest from miners in copper in the context of increasingly challenged production and difficulties in fully completing projects. Anglo’s (Neutral) prospects in copper are now better valued and this is also the case for BHP (Neutral vs Underperform) although not so for Rio Tinto (Outperform vs Neutral). Downstream, Nexans and Montana Aerospace are our Top Picks (Outperform) vs Aurubis, Rexel and Prysmian (Neutral). - ...

Nokian Renkaat Oyj : Début d’année plus difficile que prévu

>Résultats inférieurs aux attentes mais guidance confirmée - Nokian Tyres a publié des résultats T1 2024 nettement inférieurs à nos attentes et celles du consensus avec un CA seulement stable à 237 M€ (consensus 265 M€) et un EBIT ajusté de -15 M€ (consensus +4 M€, ODDO BHF -3 M€), notamment pénalisé par des facteurs externes (grèves en Finlande, impacts Mer Rouge) qui ont davantage impacté sa production que ce que nous anticipions (impact CA de ~25 M€ au T1) et qui ...

Nokian Renkaat Oyj : A tougher start to the year than expected

>Earnings short of estimates but guidance confirmed - Nokian Tyres reported Q1 2024 earnings far below our estimates and those of the consensus with sales merely stable at € 237m (consensus € 265m and adjusted EBIT of -€ 15m (consensus +€ 4m, ODDO BHF -€ 3m), notably penalised by external factors (strikes in Finland, disruptions in the Red Sea) which have hit the group’s production harder than we expected (sales impact of ~€ 25m in Q1), and which should continue to af...

Nokian Tyres (Hold, TP: EUR9.00) - Soft Q1, with or without setbacks

The Q1 results were below our expectations, even after adjusting for the negatives on the group profit from the political strikes in Finland and the Red Sea conflict. On a positive note, the PCT price/mix was guided to hold up well, partly offsetting our revised lower sales expectations, while the Romanian factory appears to be ramping up on schedule. We reiterate our HOLD but have cut our target price to EUR9.0 (9.5), after lowering our 2024–2026e clean EBIT by c6% on average.

ODDO BHF SECURITIES MORNING NEWS – DETAILED COMMENTS 04/29/2024

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ODDO BHF SECURITIES MORNING NEWS – COMMENTAIRES DETAILLES 29/04/2024

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SKF : 2024 guidance still looks ambitious to us, based mainly on H2

>Q1 2024: margin resilience (+30bp for adjusted EBIT margin to 13.4%) - SKF reported on the morning of Friday, 26 April, Q1 2024 results ahead of expectations at the adjusted EBIT level.Revenues were down 7% on an organic basis (vs css at -6.5%). Although not quantified by SKF, volumes were down significantly, on our estimates (~-10%) with a still positive price-mix effect (~3%).The adjusted EBIT margin was up 30bp to 13.4% (vs css at 12.9%), a good performa...

SKF : La guidance 2024 nous semble toujours ambitieuse, reposant princ...

>T1 2024 : résilience des marges (+30 pb de marge d’EBIT ajusté à 13.4%) - SKF a publié vendredi matin des résultats T1 2024 supérieurs aux attentes au niveau de l’EBIT ajusté.Le chiffre d’affaires était en recul organique de 7% (vs css à -6.5%). Bien que non quantifiés par SKF, nous estimons que les volumes étaient en recul significatif (~-10%) avec un effet prix/mix toujours positif (~3%).La marge d’EBIT ajusté était en hausse de 30 pb à 13.4% (vs css à 12...

Comfortingly undramatic

In-line Q1 as Auto margin recovered. Estimates unchanged; return to growth modelled for Q4. Adds some support even after partial cyclical re-rating. HOLD.

SKF (Hold, TP: SEK250.00) - Margins going in the right direction

Disregarding some unclarity on fixed-cost under-absorption during the conference call, we view SKF’s Q1 report as solid, especially the better-than-expected adj. EBIT margin, supporting the longer-term margin story. However, cash flow was on the soft side and we struggle to bridge the 2024 guidance, which could become a more prominent risk later in the year. We have raised our 2024–2026e adj. EBIT by 3% and target price to SEK250 (240), and reiterate our HOLD.

Sandvik AB: 1 director

A director at Sandvik AB bought 500,000 shares at 228.239SEK and the significance rating of the trade was 67/100. Is that information sufficient for you to make an investment decision? This report gives details of those trades and adds context and analysis to them such that you can judge whether these trading decisions are ones worth following. Included in the report is a detailed share price chart which plots discretionary trades by all the company's directors over the last two years clearly ...

ODDO BHF SECURITIES MORNING NEWS – DETAILED COMMENTS 04/26/2024

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ODDO BHF SECURITIES MORNING NEWS – COMMENTAIRES DETAILLES 26/04/2024

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SKF : A resilient margin despite a marked decline in sales in Q1

>Q1 2024: sales down 7% organic, adjusted EBIT margin up 30bp - This morning, SKF published Q1 2024 results that came in a shade below forecasts on sales but beat expectations on the EBIT margin.Sales were SEK 24.7bn (consensus at SEK 24.8bn), an organic decline of -7% (consensus at -6.5%). This decline resulted in negative volumes at both divisions, with a -7.3% decline in sales for Industrial and -6.2% in Automotive. As expected, the group indicates a marked sl...