MS upgrades Alfa Laval, says '2024 looking increasingly well'

Alfa Laval AB

26/07/2023 10:13

** Morgan Stanley upgrades Alfa Laval  ALFA.ST  to
"equal-weight" from "underweight" as 2024 is looking
increasingly well for co, underpinned by backlog, tanker orders
recovering, and FX
    ** Alfa Laval's stock up 0.16% at SEK 386.30 as of 0910 GMT
    ** Broker flags orders in the company's tankers segment have
recovered faster than expected, which underpins the marine
margin recovery in 2024-25
    ** MS co's FX hedging is resulting in a lagged 2024 SEK 680
mln positive impact on EBIT -- higher than its previous
expectations
    ** Moreover, co's delivery backlog is up SEK 10 bln versus
12 months ago, which provides significant visibility on 2024
sales, it says
    ** MS sees backlog for delivery in 2024 and beyond of SEK 25
bln translating into 2024 revenues of SEK 69.2 bln
    ** It expects revenue growth likely to slow in 2025, but
sees a significant revenue correction in 2024-25 unlikely
    ** MS still thinks Alfa Laval is at risk from an
early-to-late cycle transition playing out, and still prefers
Wartsila  WRT1V.HE 
    ** Out of 20 analysts, six rate the stock "buy" or higher,
ten "hold", and four "sell" - Refinitiv

 (Reporting by Marta Frackowiak)
 ((marta.frackowiak@thomsonreuters.com))