UBS has downgraded its recommendation on Alfa Laval from 'neutral' to 'sell', with a price target reduced from SEK 430 to SEK 334, implying a downside potential of 13% for the Scandinavian engineering group's shares.
After outperforming the share price by 55% over the past three years, we see 2024 as a transitional year, and expect Alfa to underperform as order intake picks up," says the broker.
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Alfa Laval AB specializes in the design, manufacturing and marketing of equipment and industrial systems for heating, cooling, separating and transporting of substances (oil, water, chemical and food substances, drinks, drugs, etc.). The activity is organized mainly arounf two families of products:
- solid and liquid treatment systems: systems for cooling, evaporation, extraction, drying, etc. intended primarily for the food processing, pharmaceutical, petrochemical, and energy sectors;
- production process equipment: decanters, heat exchangers, pumps, valves, air and liquid filtration systems, etc.
Net sales are distributed geographically as follows: Sweden (2.2%), Europe (32.5%), China (14.1%), South Korea (5.5%), Asia (18.2%), United States (16.7% ), North America (2.1%), Latin America (5.6%), Africa (1.9%) and Oceania (1.2%).
ALFA LAVAL AB 
