* Q1e: Sales of SEK 1,143m (1,206m), EBIT of SEK 35m (13m) * US good but not great, Germany soft * Trading at 12-7x EV/EBIT '26e-'27e
Q1 expectations
We expect Ferronordic to deliver Q1 sales of SEK 1,143m, -5% y-o-y (of which -10% FX). We expect adj. EBIT of SEK 35m, rendering a margin of 3.0% (1.1% in Q1'25, 4.5% in Q4'25). We do not fully extrapolate the seasonally strong Q4, which was reached with ATH EBIT margins in the US.
Mixed regional trends, but leading indicators improving
For the US, we make slight negative margin adjustments following the integration of Housby Heavy Equipment. Management reports that the underlying market remains solid so far, despite increasing geopolitical uncertainties. This is also mirrored by continued strong ISM figures (52.7 in March). We estimate that the NWC build-up during Q4 will continue as Rudd sales remain relatively high. In Germany, we expect truck sales to remain subdued in the near term. Management flagged persistent customer caution, with order deferrals into H2'26, partly reflecting the ongoing geopolitical uncertainty. We cut Germany '26e EBIT by ~SEK 7m, primarily based on lower margin assumptions, with a lack of operational leverage continuing to weigh on earnings. That said, there are some encouraging leading indicators, which prevents us from extrapolating the current weakness. Volvo Trucks raised its European 2026 market guidance by 10,000 units (~3%) in Q4, and the German manufacturing PMI expanded sequentially to 52.2 in March (50.9 in February), both pointing to gradually improving end-demand. Zooming out, we cut '26e group EBIT by 4% with sales unchanged (+2% FX, -2% org.).
Trading at 12-7x EV/EBIT vs. peers at 15-14x
Finally, we expect ageing truck fleets to eventually reach an inflection point at which fleet renewal will drive a German recovery. The share is currently trading at 12-7x EBIT '26e-'27e vs our distributor peer group at 15-14x.