Sweden's Bufab Q3 sales rise 16.6% on market share gains

Overview

• Sweden supply chain trading firm's Q3 net sales rose 16.6% yr/yr, organic growth 6.5%

• Q3 EPS improved to SEK 1.16 from SEK 0.75

• During the quarter, company acquired UK-based D.C. Iron to support growth strategy

Outlook

• Company expects gross margin to remain at a high level in coming quarters

• Company notes slight improvement in market conditions but sees higher purchasing prices from Asia

• Bufab aims to gain market share, improve margins and cost base, and deliver strong cash flow

Result Drivers

• MARKET SHARE GAINS - Co said net sales growth was driven by market share gains and stronger demand in electronics, mechatronics, electrification, digital infrastructure, aerospace and defence

• MIX AND PRICING - Co attributed margin improvement to better customer and product mix, value-based pricing and cost control

• ACQUISITION CONTRIBUTION - Co said D.C. Iron acquisition performed well and integration is progressing as planned

Company press release:

Key Details

Analyst Coverage

• The current average analyst rating on the shares is "buy" and the breakdown of recommendations is 1 "strong buy" or "buy", 3 "hold" and no "sell" or "strong sell"

• The average consensus recommendation for the industrial machinery & equipment peer group is "buy"

• Wall Street's median 12-month price target for Bufab AB (publ) is SEK137.50, about 0.7% above its October 22 closing price of SEK136.60

• The stock recently traded at 28 times the next 12-month earnings vs. a P/E of 28 three months ago

Reuters Recommended Reads

• Oct 22 - Sweden's Sandvik Q3 revenue beats estimates on order growth

• Oct 22 - Sweden's Atlas Copco Q3 revenue slightly beats estimates, orders up 29%

• Oct 22 - MSC Industrial Q4 sales slightly beat on core customer growth

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(This story was created using Reuters automation and AI based on LSEG and company data. It was checked and edited by a Reuters journalist prior to publication.)