Alfa Laval Earnings: Robust Food and Water Market Conditions Lend Support to New Orders

Investors cheered wide-moat Alfa Laval’s delivery of strong first-quarter results—which tracked ahead of our full-year expectations—and upwardly revised guidance, which paints a rosier picture for Alfa Laval in 2024. First-quarter order intake was robust, rising 1% organically year on year, and 8% sequentially. Indeed, market conditions are proving more buoyant than we’d previously anticipated, with our prior forecasts factoring a material weakening in demand for Alfa Laval’s suite of highly engineered products in 2024. We lift our fair value estimate by 6% to SEK 360 to reflect the better-than-anticipated demand in 2024 year to date. A time value of money adjustment also contributes to our revised valuation.