Company Reports

Alfa Laval is a specialist in thermal and flow technologies, supplying equipment and systems for heating, cooling, separation, and fluid handling across a wide range of industrial end markets. Its strategy focuses on areas where its engineering depth and product performance are highly valued, particularly in applications that are mission-critical, energy-intensive, and regulated.

Alfa Laval delivered a record second-quarter order intake of SEK 22.2 billion, up 29% organically, led by Energy division data center demand. Adjusted EBITA margin fell to 17.0% from 17.8% as the mix shift weighed on profitability.

Alfa Laval is a specialist in thermal and flow technologies, supplying equipment and systems for heating, cooling, separation, and fluid handling across a wide range of industrial end markets. Its strategy focuses on areas where its engineering depth and product performance are highly valued, particularly in applications that are mission-critical, energy-intensive, and regulated.

Alfa Laval posted first-quarter 2026 adjusted EBITA of SEK 2.9 billion at an 18.1% margin—versus last year's 17.7%—despite a revenue miss driven by fourth-quarter timing spillover and Middle East logistics disruptions. The 1.1 times book/bill signals underlying demand is intact.

Alfa Laval closed 2025 with a record-breaking fourth quarter of 11% organic sales growth and adjusted EBITA of SEK 3.2 billion with a 16.9% margin. While order intake declined modestly on a tough marine comparison, execution stayed strong across the group, alongside a major internal reorganization.

Alfa Laval delivered a solid third-quarter 2025, posting record adjusted EBITA with an 18.4% margin, up 1.1% year over year. While orders expectedly fell 10% organically against an exceptionally strong marine comparison, sales rose 8% organically on strong execution and a healthy backlog.

Alfa Laval is a specialist in thermal and flow technologies, supplying equipment and systems for heating, cooling, separation, and fluid handling across a wide range of industrial end markets. Its strategy focuses on areas where its engineering depth and product performance are highly valued, particularly in applications that are mission-critical, energy-intensive, and regulated.

We take a fresh look at Alfa Laval following a transfer of coverage. The company is a global specialist in heat transfer, separation, and fluid handling, supplying engineered systems to energy, marine, food, water, and life sciences customers.

Alfa Laval reported second-quarter 2025 organic sales growth of 2% and an adjusted EBITA margin of 17.8%, up 110 basis points from a year ago, even though organic orders fell 8%. Foreign exchange headwinds weighed on reported numbers.

Alfa Laval reported first-quarter 2025 sales growth of 11% and an adjusted EBITA margin of 17.7%, up 140 basis points from a year ago, exceeding market expectations even though organic orders fell 3%. The order book reached a record SEK 52 billion, covering more than nine months of revenue.

Demand conditions remained buoyant for wide-moat Alfa Laval’s marine division in the fourth quarter of 2024, driving an 8% year-on-year increase in quarterly group order intake. Exceptional shipbuilding demand conditions remained in place in the final quarter of 2024, delivering a 39% year-on-year increase in organic order intake for the marine division. Elsewhere, demand conditions were mixed with new orders for the energy division rising about 7.5% organically while organic order intake for the food and water division contracted about 12% compared with the prior corresponding period. Alfa Laval anticipates a similar order intake in the first quarter of 2025 to that of the final quarter of 2024. While we expect to revise our 2025 order intake and related earnings forecasts, we continue to expect demand to moderate as 2025 progresses and we therefore continue to view Alfa Laval shares as expensive. We don’t expect our tweaked 2025 estimates to have a material impact on our SEK 360 fair value estimate, with Alfa Laval shares trading at a 28% premium to our valuation.

We walked away from wide-moat Alfa Laval’s 2024 capital markets day confident that it is well positioned to capitalize on a range of energy transition-related growth opportunities, supporting medium-term earnings growth. Alfa Laval detailed a number of such opportunities for the group’s heat exchanger business, which include the industrial sector’s rising energy efficiency ambitions, residential heat pumps, as well as cooling and waste heat recovery applications in data centers. We view these opportunities as supportive of the energy division’s top-line growth in the present decade and key to achieving the group’s unchanged long-term financial targets. Certainly, the range of decarbonization themes where Alfa Laval’s heat transfer and liquids separation technologies find application is broad. Still, Alfa Laval shares screen expensively—trading at a 32% premium to our unchanged SEK 360 fair value estimate—with investors overly optimistic as to the order book opportunity that some of these secular themes are likely to represent in the current decade.

Alfa Laval’s strategy is one of specialization that focusses on process engineering niches where it is a technology leader: separation, heat transfer, and fluid handling. Its industry-leading suite of highly engineered products improve energy efficiency and processing yields, reduce waste, and enhance manufacturing quality.

Alfa Laval's order intake remained on a high level in the third quarter of 2024, holding steady relative to the buoyant order intake in the prior quarter and up 15% organically year on year, with elevated demand persisting for the marine division amid buoyant global shipbuilding market conditions. Organic third-quarter revenue rose 6%, supported by Alfa Laval's order backlog, which grew once more in the quarter and stands at SEK 52.1 billion as of September. We expect the healthy order book position to support earnings in 2025, despite a likely new-order headwind as the spike in demand for Alfa Laval's marine division subsides.

Order intake remained strong for wide-moat Alfa Laval in the second quarter of 2024. New orders rose 4% year on year on an organic basis or 1.6% quarter on quarter, after adjusting for seasonality, buoyed by strong demand conditions for the marine segment. Second-quarter revenue rose 11% organically, supported by a very healthy order backlog that now stands at SEK 49.5 billion at June 30, 2024, which we expect will continue to drive strong top-line and earnings growth throughout the remainder of 2024 and into 2025. Alfa Laval’s EBITA margin firmed to 16.7%, up 30 basis points sequentially, driven largely by improvement in the food and water segment’s EBITA margin quarter on quarter. A marked uplift in food and water invoicing drove improved unit cost recoveries for the segment. Alfa Laval shares are up modestly at the time of writing and continue to screen expensively, trading at a substantive 31% premium to our unchanged SEK 360 fair value estimate.

Alfa Laval’s strategy is one of specialization that focusses on process engineering niches where it is a technology leader: separation, heat transfer, and fluid handling. Its industry-leading suite of highly engineered products improve energy efficiency and processing yields, reduce waste, and enhance manufacturing quality.

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.

Alfa Laval’s strategy is one of specialization that focusses on process engineering niches where it is a technology leader: separation, heat transfer, and fluid handling. Its industry-leading suite of highly engineered products improve energy efficiency and processing yields, reduce waste, and enhance manufacturing quality.

Wide-moat Alfa Laval’s fourth-quarter 2023 results fell short of our expectations, with the external demand environment representing more of a headwind than we’d anticipated and restructuring efforts also tracking behind our forecasts. New orders in late 2023 were soft relative to our expectations, with a number of puts and takes at the divisional level that led Alfa Laval’s full-year 2023 order intake to trail our forecast for the group by about 3%. Full-year 2023 group EBITA of SEK 10.2 billion also fell somewhat short of our expectations, owing primarily to a weaker-than-expected marine division profit margin, with previously announced restructuring efforts for the division taking longer to bear fruit than we’d previously credited.

Wide-moat Alfa Laval’s 2023 capital markets day provided us with no major surprises, with no material changes to either the group’s strategic direction or revision of the company’s financial targets announced. Consequently, we make no changes to our estimates or our SEK 340 fair value estimate. Alfa Laval shares screen as modestly overvalued, trading at a 7% premium to our unchanged valuation.