Electrolux Had a Better Quarter, but Demand Could Weaken Near-Term

Dow Jones07-31

1023 GMT - Electrolux second-quarter results saw all three divisions beat on profitability, with North America the relative star as it produced a slight adjusted profit versus expected losses, Deutsche Bank analyst John Kim writes. Guidance for the year is largely unchanged, with financials set to change dramatically this year and next as the new Midea joint ventures factor into the numbers. "Disclosure is limited at this point, particularly on balance sheet adjustments for the two production JVs, with the sales JV additive to Electrolux's Q3 numbers this year." That said, the near-term demand outlook remains weak, particularly in the U.S., Kim adds. Deutsche Bank retains its hold rating for the stock and lifts its target price to 33 Swedish kronor from 30 kronor. Shares fall 1.8% to 28.23 kronor.

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