SKF : Une marge résiliente malgré la forte baisse du chiffre d’affaire...

>T1 2024 : CA en recul organique de 7%, marge d’EBIT ajusté en hausse de 30 pb - SKF a publié ce matin des résultats T1 2024 légèrement inférieurs aux attentes au niveau du chiffre d’affaires mais supérieurs sur la marge d’EBIT.Le CA atteint 24.7 MdSEK (consensus à 24.8 MdSEK), en recul organique de 7% (consensus à -6.5%). Ce recul embarque des volumes négatifs dans les deux divisions avec un recul du CA de 7.3% pour Industrial et de 6.2% pour Automotive. Comme a...

Decent margin despite lower auto volume

SKF (Hold, TP: SEK240.00) - Views on Q1 and guidance

We are 3% below consensus on Q1e adj. EBIT, and expect a reiterated 2024 guidance for a low single-digit YOY organic sales decline and Q2 guidance to be issued for a mid-single digit YOY organic sales decline. We have made minor estimate revisions and are 6–7% below consensus on 2024–2026e adj. EBIT. We reiterate our HOLD and have raised our target price to SEK240 (225).

ODDO BHF SECURITIES MORNING NEWS – COMMENTAIRES DETAILLES 01/02/2024

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ODDO BHF SECURITIES MORNING NEWS – DETAILED COMMENTS 02/01/2024

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SKF : We see the 2024 guidance as ambitious

>Q4 2023: 8% ahead of expectations at the EBIT level, thanks to industrial division - Yesterday morning SKF reported Q4 2023 results that beat expectations with an organic decline of -1.9% (vs consensus -2.9%) and an operating EBIT margin up +200bp to 12% (vs consensus 10.9%). Volumes were down significantly by close to -7% by our estimates, while the price effect was still positive (just below 5% according to management comments). The Industrial division posted ...

SKF : La guidance 2024 nous semble ambitieuse

>T4 2023 : 8% au-dessus des attentes au niveau de l’EBIT, grâce à Industrial - SKF a publié hier matin des résultats T4 2023 supérieurs aux attentes avec un recul organique de 1.9% (vs css à -2.9%) et une marge d’EBIT opérationnel de 12% en hausse de 200 pb (vs css à 10.9%). Les volumes sont en recul significatif, à près de 7% selon nous, avec un effet prix toujours positif (légèrement inférieur à 5% d’après les commentaires du management). La division Industrial...

SKF (Hold, TP: SEK225.00) - Currency conundrum

The Q4 report included Q1 and 2024 organic growth guidance in line with consensus, while a key highlight was the strong Industrial margin, where efforts to prune the portfolio started to take effect. FX had a surprisingly negative effect on sales growth, and the company made a SEK338m adjustment to EBIT for hyperinflation accounting in Argentina, which we estimate will result in EBIT being overstated by 2–3% in 2024. We reiterate our HOLD, but have raised our target price to SEK225 (220), having...

ODDO BHF SECURITIES MORNING NEWS – DETAILED COMMENTS 01/31/2024

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ODDO BHF SECURITIES MORNING NEWS – COMMENTAIRES DETAILLES 31/01/2024

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SKF : Q4 2023 better than expected (at the operating level)

>Q4 2023: organic decline in sales of 1.9% and adjusted EBIT margin of 12% - SKF this morning reported Q4 2023 results that just missed expectations (forex impact in the automotive division) at the level of sales, which came to SEK 24.438bn (consensus SEK 24.592bn), down -1.9% on an organic basis (consensus -2.9% and ODDO BHF -4%). This decline therefore reflects negative volumes, notably in the industrial division where sales were down -3% organically (automotive: +0...

SKF : Un T4 2023 meilleur qu’attendu (sur le plan opérationnel)

>T4 2023 : recul organique du CA de 1.9% et marge d’EBIT ajusté de 12% - SKF a publié ce matin des résultats T4 2023 légèrement inférieurs aux attentes (impact forex dans la division Automotive) au niveau du chiffre d’affaires qui atteint 24.438 MdSEK (consensus à 24.592 MdSEK), en recul organique de 1.9% (consensus à -2.9% et ODDO BHF à -4%). Ce recul embarque donc des volumes négatifs, notamment dans la division Industrial dont le CA est en recul organique de 3% (Au...

ODDO : 2024, year of transition … and growth

2024 is set to be less impressive than 2023 (comparison bases, persistent inflation and tougher price hikes). We continue to play the green Capex theme and remain cautious on the construction segment. After the end-of-year rally, we see more limited re-rating potential. Based on our 2024 guidance scenarios, our Top Picks are Atlas Copco, Schneider Electric and Siemens (green Capex exposure, potential for earning upgrades over the course of the year). We have downgraded Rexel to N...

ODDO : 2024, année de transition … et de croissance

L’année 2024 sera moins flamboyante que 2023 (base de comparaison, inflation persistante et hausses de prix plus difficiles). Nous continuons de privilégier la thématique ‘Green Capex’ et restons prudents sur le segment de la construction. Après le rallye boursier de fin d’année, le potentiel de rerating nous semble plus limité. Sur la base de nos scénarios de guidances 2024, nos top picks sont Atlas Copco, Schneider Electric et Siemens (exposition Green Capex, potentiel de relèv...

ODDO BHF SECURITIES MORNING NEWS – DETAILED COMMENTS 01/09/2024

Defensives are sharply outperforming cyclicals at the start of 2024. We think investors should start to gear portfolios towards our more cautious strategic allocation for 2024, while also taking account of the likely continuation of volatility on rates. Within defensives, we prefer utilities, telecoms, personal care & grocery stores and insurance. We think that the recent sell-off for technology offers an entry point, particularly in the semiconductors segment. We remain cautious on d...

ODDO BHF SECURITIES MORNING NEWS – COMMENTAIRES DETAILLES 09/01/2024

Les défensives surperforment nettement les cycliques en ce début d’année. Nous pensons qu’il faut commencer à orienter les portefeuilles vers notre allocation stratégique 2024, plus prudente, tout en intégrant la probable poursuite de la volatilité sur les taux. Au sein des défensives, nous privilégions Utilities, Telecoms, Personal Care & Grocery Stores et Assurances. Nous considérons que la baisse récente de la Technologie est un point d’entrée, notamment sur le segment des semicond...

SKF : Q4 2023 preview: a little premature due to the lack of visibilit...

>Q4 2023e: sales organic decline of 4%, adjusted EBIT margin of 10.8% (+80bp) - Following contact with the company and the publication of macroeconomic data, we have updated our forecasts for SKF.For Q4 2023, we forecast a -4% organic decline in sales (vs -3.7% previously), including a price effect of 2.9% and a 6.9% decline in volumes (after -1% and -5.6% for the past two quarters). For Q4 the group anticipates a low-single-digit organic decline in sales. T...

SKF : Preview T4 2023 : un peu trop tôt par manque de visibilité

>T4 2023e : recul organique du CA de 4%, marge d’EBIT ajusté de 10.8% (+80 pb) - Suite à un contact société et à la publication de données macroéconomiques, nous mettons à jour nos prévisions sur SKF.Pour le T4 2023, nous anticipons un recul organique du CA de 4% (vs -3.7% précédemment), incluant 2.9% d’effet prix et des volumes en baisse de 6.9% (après -1% et -5.6% lors des deux derniers trimestres). Le groupe vise pour le T4 une baisse organique du CA « low sin...

SKF (Hold, TP: SEK220.00) - Risk of profit-taking

We reiterate our SEK220 target price but have downgraded SKF to HOLD (BUY) following the c15% share-price rally since our upgrade in October, while we have cut our 2024–2025e adj. EBIT (which was already below consensus) by another c6%, mainly on FX. We still believe the valuation is reasonably supportive but that consensus needs to come down and the 2024 guidance (or lack of it) could be a catalyst for investors to take profit on the recent strength.

Decoding Alpha

Our analysis of underlying total shareholder return (TSR) drivers for Swedish Industrial companies reveals that high returns are not synonymous with high valuations. Investors tend to overpay for ‘growth’, while cash returns such as dividends and buybacks are typically deeply discounted. We believe Autoliv, Alfa Laval and Hexagon offer the most long-term TSR potential (13–14% annualised), with SKF and Trelleborg at the other end of the spectrum (8–9%), while also concluding that several stocks l...