Thursday, July 18, 2019

Alfa Laval Swamped By Surprisingly Weak Marine Orders

Writing about Swedish conglomerate Alfa Laval (OTCPK:ALFVY) (ALFA.ST) after first quarter earnings, I said, “Give me a 10% to 15% pullback and these shares get much more interesting as a potential long-term holding.” With disappointing orders in the second quarter and increasingly shaky investor sentiment around industrials, Alfa Laval shares have now pulled back a little more than that 15% target.

In the short term, there are still risks. Alfa is benefiting from record high orders in Energy, and I’m not confident that that is sustainable. Elsewhere, ship contracting has been below expectations, raising some concerns about the near-to-medium-term outlook for the Marine business. Still, this is a quality multi-industrial leveraged to multiple attractive trends, and while this may not be the bottom, I think the price is attractive for long-term investors.

Read more here:
Alfa Laval Swamped By Surprisingly Weak Marine Orders

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