Dometic (Buy, TP: SEK100.00) - Recovery taking time

Overall, Q1 was below consensus, driven by surprisingly weak performance for Land Vehicles Americas where Dometic said the competitive environment was tough. We have cut our 2024–2026e adj. EBIT by c3% on average and reduced our target price to SEK100 (105). We reiterate our BUY, seeing c25% upside potential from the current share price to our target price, but have pushed a recovery out in time.

Dometic (Buy, TP: SEK105.00) - Motoring on

We estimate Q1 sales of SEK6,614m and adj. EBIT of SEK595m (adj. EBITA of SEK745m). Q1 tends not to be a seasonally strong cash flow quarter and we expect end-Q1 net debt/EBITDA of 2.8x. We have increased our 2024–2026e adj. EBIT by c4% on average, reflecting updated FX and somewhat higher profitability. We reiterate our BUY and have raised our target price to SEK105 (100) on updated valuation and estimates.

Dometic Group AB: 1 director

A director at Dometic Group AB bought 3,081 shares at 78.302SEK and the significance rating of the trade was 50/100. 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 clear...

Dometic (Buy, TP: SEK100.00) - US RV trough probably behind us

Q4 is a small quarter, but overall was below our estimates and consensus, driven by weaker than expected organic growth and margins. We have cut our 2024–2025e adj. EBIT by c6% on average and have lowered our target price to SEK100 (105). The US RV OEM trough has seemingly passed and sales in Service and Aftermarket (including within Marine) continue to improve. We reiterate our BUY.

Dometic (Buy, TP: SEK105.00) - Resilience in a small quarter

We estimate Q4 sales of SEK5,600m and adj. EBIT of SEK405m (adj. EBITA of SEK555m). We expect solid cash flow generation and net debt/EBITDA of 2.8x (2.9x in Q3). We have cut our 2023–2025e adj. EBIT by c5% on average, largely due to updated FX. We reiterate our BUY and have raised our target price to SEK105 (96) on among others after rolling forward our valuation. The results are due on 31 January.

Dometic (Buy, TP: SEK96.00) - Motoring through the storm

Q3 cash flow was strong and margin resilience impressive (again), as costs are being addressed swiftly. Dometic has proved its credentials in a tough market, in our view. After making only small estimate changes, we reiterate our BUY and SEK96 target price.

Dometic (Buy, TP: SEK96.00) - Cash and margin resilience

We estimate Q3 sales of SEK7,254m and adj. EBIT of SEK792m (adj. EBITA of SEK942m). We expect solid cash flow generation and net debt/EBITDA of 3.0x (3.2x in Q2). We have raised our 2023–2025e adj. EBIT by c2% on average, and reiterate our BUY and SEK96 target price. The Q3 results are due on 26 October (time not known), with a conference call at 10:00 CET.

Northern Lights

Dometic (Buy, TP: SEK96.00) - Navigating chopping waters

Q2 was strong despite a difficult market. Adj. EBIT beat our estimate, driven by better-than-expected group profitability and cash flow. However, updated FX and raised net financials mean we have made limited changes to our 2023-25e adj. EPS, and we reiterate our BUY and SEK96 target price. We continue to see an attractive risk/reward, with c20% potential upside.

Dometic (Buy, TP: SEK96.00) - Minor changes ahead of results

We expect SEK8,095m of Q2 sales with -12% organic growth YOY and adj. EBIT of SEK857m. We believe Marine will continue to show resilience in Q2 while YOY comparables for the Americas (mostly RV) become easier as we move towards end-2023. We have made minor (1% on average for 2023–2025 adj. EBIT) estimate changes, and reiterate our BUY and SEK96 target price.

Northern Lights

Dometic (Buy, TP: SEK96.00) - All aboard!

Q1 was strong (adj. EBIT 9% above consensus), with especially impressive margin resilience and cash-flow generation despite a tough market. We have updated our model, increased our 2023–2025e adj. EBIT by 6% on average (mostly in 2023e) and raised our target price to SEK96 (88). We reiterate our BUY.

Northern Lights

Still going strong

Although reported EU taxonomy alignment for the sector is low, we have identified which companies screen best and could benefit from attracting ESG capital. We still favour China, mining, energy and aftermarket exposure, and see upside potential to consensus estimates, but view overall risk/reward as neutral on elevated valuation.

Dometic (Buy, TP: SEK88.00) - Limited changes ahead of Q1

We forecast Q1 sales for Dometic of cSEK7.1bn and adj. EBIT of SEK506m, below consensus. We have updated our model but have left our average 2023–2025e adj. EBIT broadly unchanged ahead of the report, and have increased our target price by c4%, to SEK88 (85), on our updated valuation (peer multiples expansion). We reiterate our BUY.

Industrial blues

DNB Markets’ Strategy and Macro team suggests being underweight industrials, due to the sector’s premium valuation and risk of >10% earnings cuts in 2023 from a cyclical slowdown. Our sensitivity analysis shows Volvo, Dometic and Autoliv have the greatest downside risk to earnings in a cyclical slowdown, while Assa Abloy and Hexagon (two of our sector top picks) should be most resilient. We prefer mining, energy, aftermarket and China exposure.

Northern Lights

Dometic (Buy, TP: SEK98.00) - All eyes on cash flow and net debt

In the Q4 report (due on 27 January) we will focus on cash-flow generation and comments on keeping or cutting the dividend payment for 2022. We have updated our model and now include an earn-out in Q2 2023 while we have incorporated 2024e into our valuation. We reiterate our BUY and SEK98 target price.

Northern Lights

Dometic - Defending its margin as the winter approaches

Solid margin despite a tough market environment Outlook: margins to hold up and leverage to come down Underlying ests. roughly unchanged, reiterate BUY