Swedish food retail market: +5% in October

Soft discount at a discount

Soft Q3 results

City Gross acquisition approved (corrected)

More growth, fewer hiccups

Swedish food prices +1.7% y-o-y in September

Axfood (Buy, TP: SEK320.00) - Upcoming efficiency gains in focus

We are neutral ahead of the Q3 report, as we forecast sales growth momentum across all segments to be offset by still-negative effects near-term from the Bålsta ramp-up. We expect focus to be on Dagab efficiency gains in the coming quarters and into 2025, and we like the industry’s continued volume growth following a weak 2023. We reiterate our BUY and SEK320 target price.

Swedish food retail market: +4.4% in August

Swedish food retail market: +4.0% in July

Axfood AB: 1 director

A director at Axfood AB maiden bought 3,000 shares at 259.866SEK and the significance rating of the trade was 71/100. 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 clea...

Axfood (Buy, TP: SEK320.00) - Looking beyond 2024 hiccups

Q2 was hurt by one-off costs in Dagab, and the Bålsta ramp-up is now expected to take longer than Axfood initially planned. That said, its annual efficiency target is unchanged, and it again outperformed the market despite very tough comparables. We reiterate our BUY, but have cut our target price to SEK320 (330) after lowering our estimates.

Weakness offers good entry point

Axfood continues to outpace the market but higher costs in Dagab and some one-offs weighed on Q2. Current weakness offers a good entry point, BUY

Axfood (Buy, TP: SEK330.00) - Trouble for Dagab hit results

We consider this a weak report, with adj. EBIT c13% below consensus. The miss was driven by a negative development in Dagab, hit by restructuring costs and disturbances in its logistics operations and costs related to the City Gross acquisition. We expect consensus 2024e adj. EBIT to come down c3–5% on the results and believe a negative share price reaction is warranted.

Soft Q2 results mainly due to one-offs

Q2 preview: solid quarter despite tough comps

Positive volume/mix in Q2'24e. Q2'24e preview: adj. EBIT of SEK 963m (+2% y-o-y). Margins set to expand: BUY and TP of SEK 320 reiterated.

Swedish food retail market: +5.1% May

Axfood (Buy, TP: SEK330.00) - Acquires City Gross

Axfood has announced it is to acquire City Gross, entering the hypermarket segment. Although City Gross will be a drag on near-term earnings, Axfood expects it to contribute positively to EPS by 2026 at the latest. Given an attractive EV/sales of 0.22x LTM to April, versus Axfood’s 2024e of 0.8x, we believe the acquisition makes strategic sense as it will diversify the company more across the Swedish grocery market.

Acquires City Gross

Axfood (Buy, TP: SEK330.00) - No drama in Q2e

Ahead of the Q2 report (due at 07:00 CET on 12 July), we expect continued revenue growth for Willy’s despite tough comparables and adj. EBIT in line with consensus. With grocery inflation more or less stable, investor focus is likely to be on the progress of the Bålsta ramp-up, and the synergies set to take effect in H2 2024 and 2025. We reiterate our BUY and SEK330 target price.

Swedish food retail market: flat in April