Assa Abloy Posts Solid First Quarter; Electromechanical Lock Demand Continues To Shine; Shares Attractive

Assa Abloy posted strong first-quarter results. Revenue increased by 14% organically at group level while the EBIT margin expanded 40 basis points to 15%, with some support from currency tailwinds. However, the company generated SEK 558 million in free cash flow during the quarter, well below the SEK 2.2 billion reported a year ago, due to higher inventory spend to secure component supplies for customer orders. We maintain our wide moat rating. Shares look attractive relative to our SEK 300 fair value estimate.