With the exception of the latecomer Nibe, all operating companies in the OMXS30 index have now reported their earnings. It has been a few days or weeks since analysts have reviewed their full-year forecasts for these companies. It’s time to digest whether the significant price increases on earnings day for companies like Getinge, SHB, Sinch, Telia, and Volvo were justified, and if the substantial declines for H&M, ABB, Atlas Copco, SCA, and Evolution were fair.
As we have discussed in previous reviews of the earnings season, just over half of the large companies have delivered better results than expected this quarter, which is slightly below the usual trend.
Cautiously Optimistic Adjustments
On average, earnings forecasts, measured as the expected net profit for the year, have been slightly adjusted upwards since the mid-year, but the change is a modest 1 percent for the OMXS30 group. Corresponding profit forecasts for 2025 have remained largely unchanged, according to the average forecasts from S&P Global.
For individual companies, changes are usually more significant. For example, the automotive giant Volvo stands out with an almost 9 percent upward adjustment in this year’s forecast, while analysts are more conservative about 2025, only nudging that forecast up by 1 percent.
Getinge, which pleasantly surprised with its earnings report, has also received an unusually large increase in its forecast this year. In this case, analysts have also become significantly more positive about 2025. However, there is downward pressure on forecasts for Hexagon, Evolution, and SCA, all of which reported weaker results than expected. Expectations have also lowered for Nibe, with their report pending this Friday.
| Earnings Forecast Changes after Q2 | 2024 | 2025 | P/E 2024 | YTD Stock Performance |
| ABB | 3.5% | 1.0% | 22.2 | 24% |
A special case is Electrolux, where the earnings are around break-even, making the figures for this year’s forecast change and P/E ratio misleading and hence marked as e/m, not meaningful, in the table.
It is interesting to note the stock market’s view on the major banks. All four have beaten earnings forecasts and have seen their 2024 profit forecasts adjusted upwards in recent weeks. However, this year’s stock performance has been relatively flat, except for the generous dividends paid out. The P/E ratios are remarkably low, ranging from 7-9.
The fear that upcoming interest rate cuts will reduce earnings from interest income and cannot be offset by better performance in other revenue sources in 2025 is evidently scaring off investors who are not solely focused on dividends.
Defensive Turns Offensive
Regarding this year’s stock performance for large companies, a defensive trend can be observed. Telecommunications companies Telia and Tele2, along with pharmaceutical giant AstraZeneca, hygiene company Essity, and defense firm Saab have all seen positive stock price movements.
However, the industrial segment has been more varied. ABB continues to perform well, but the sector as a whole has not been thriving in 2024, with recent economic concerns cooling off many stocks in the industry.
Hexagon, for example, has experienced a downward trend both in forecasts and stock prices.
Analysis Breakdown:
This article dives into the recent earnings reports of companies in the OMXS30 index, analyzing the market reactions and forecast adjustments. It highlights the trends in earnings forecasts, stock performances, and P/E ratios for various companies, providing insights into the overall market sentiment.
Investors can use this information to assess the performance of individual companies, understand the market trends, and make informed decisions about their investment strategies. By staying updated on the latest financial news and market trends, investors can navigate the stock market more effectively and optimize their investment portfolios for long-term growth.
Title: Unveiling the Top Investment Opportunities in the Current Financial Market
As a seasoned investment manager with a keen eye for lucrative opportunities in the financial market, I am excited to share with you the top investment options that are currently available. In this article, I will provide you with valuable insights into where you should be putting your money for maximum returns.
In today’s volatile market, it is crucial to make informed decisions when it comes to investing. By staying ahead of the curve and identifying trends before they take off, you can position yourself for success in the long run.
Whether you are a seasoned investor or just starting out, there are plenty of opportunities to grow your wealth in the current market environment. From tech stocks to real estate investments, there is something for everyone.
I will delve into the latest market trends, analyze key indicators, and provide you with actionable advice on how to navigate through the complexities of today’s financial landscape. By following my recommendations, you can make smart investment choices that will help you achieve your financial goals.
In conclusion, it is important to stay informed and educated about the latest developments in the financial market. By taking advantage of the opportunities that are available, you can grow your wealth and secure your financial future. Don’t miss out on the chance to capitalize on the top investment opportunities in today’s market – start investing wisely today.