Trelleborg

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Trelleborg is a diversified industrial machinery company that provides solutions in the area of high-performance polymer engineering for various industries. End of September 2015, Trellebord acquired the US marine fender systems company Maritime International Inc. This deal could expand and broaden Trelleborgs presence in North America on the one hand and enlarge local production capabilities as well as engineering and testing expertise on the other hand.

Currently, Trelleborg derives 34% of its sales from the automotive sector, 12% from construction and 12% from the oil & gas industry. The high dependence on the automotive sector as well as a current Analyst cut from accumulate to reduce from Handelsbanken could lead to further turmoil in the stock.

Whereas SEB analysts recently mentioned that Trelleborg “will continue to experience below industry average organic sales growth in the coming quarters”. Nevertheless SEB expects that organic growth could recover slightly in 2015. Analysts from Handelsbanken in contrast refer to ongoing struggles with negative organic growth over the last five quarters and underline the importance of growth on the management agenda. They even expect a tougher year in 2016 due to weakening markets. Therefore Handelsbanken see limited upside in the Trelleborg stock and changed their recommendation to reduce.