There are several secular growth stories out there for investors, including electrification, automation, and data growth, but clean energy technology (including decarbonization) has been getting its time in the spotlight more recently. With strong technologies in heat transfer, separation, and fluid handling, the Street has started to appreciate Alfa Laval’s (OTCPK:ALFVF) (OTCPK:ALFVY) leverage to this opportunity, as well as the leverage in the Food/Water business to alternative proteins.
When I last wrote about Alfa Laval in August of 2020, I suggest investors hold off in the hope of a lower price. They got that chance with a roughly 20% decline from early August to late October, since which the shares have risen almost 50%.
At today’s price I think Alfa Laval offers a return potential on par with other high-quality industrials, many of which also have leverage to attractive long-term secular themes (Eaton (ETN), Emerson (EMR), Honeywell (HON), Schneider (OTCPK:SBGSF) (OTCPK:SBGSY), et al). I think it’s a decent enough hold at this level, but near-term expectations may yet be a little high and if there’s a sell-off after Q1 earnings/guidance, it’s a name I’d revisit.
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Alfa Laval Trading On Par With Other Quality Industrials, And Offering A Clean-Tech Kicker
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