Last Update 06 Jul 26
Fair value Decreased 20%ELAN B: Leadership Succession And Higher Margins Will Support Future Upside
Analysts have lowered their fair value estimate for Elanders from SEK 110.00 to about SEK 88.17. They now apply a slightly higher discount rate and a lower future P/E of around 8.0, even though their assumptions for revenue growth and profit margins are modestly higher.
What’s in the News for Elanders
- Elanders AB’s Board of Directors has appointed Florian Beck as the next CEO of the Group, effective September 1, 2026. Source: Key Developments
- Florian Beck currently serves as President of Elanders’ subsidiary LGI and is a member of Group Management, with experience in Supply Chain Solutions across Europe and North America. Source: Key Developments
- Current President and CEO Magnus Nilsson plans to step down when he turns 60, after approximately 17 years in the role leading Elanders’ shift from a Swedish printing business to an international logistics group with operations in about 20 countries. Source: Key Developments
Valuation Changes for Elanders
- Fair Value: Reduced from SEK 110.00 to about SEK 88.17, a cut of roughly 20%, indicating a lower central estimate for Elanders’ equity value.
- Discount Rate: Raised slightly from 9.97% to 10.42%, which means analysts are applying a somewhat higher required return to Elanders’ future cash flows.
- Revenue Growth: Adjusted from an expected decline of about 0.60% to an expected increase of about 2.60%, expressed as SEK revenue growth in the updated model.
- Profit Margin: Revised from about 3.95% to about 4.08%, pointing to a small uplift in expected SEK earnings relative to revenue.
- Future P/E: Brought down from about 9.68x to about 8.04x, implying a more conservative valuation multiple for Elanders’ expected earnings.
Key Takeaways
- Structural cost savings and debt reduction are set to improve financial stability and enhance future earnings.
- Growth in electronics and expansions in Asia and North America could drive revenue increases amidst strong customer demand.
- Declining demand, trade disputes, and structural changes negatively impact Elanders' revenue, margins, and overall profitability across multiple segments.
Catalysts
About Elanders- A logistics company, provides supply chain, and print and packaging solutions in Sweden, Germany, the United States, Singapore, the United Kingdom, the Netherlands, India, China, Switzerland, Poland, Hungary, and internationally.
- Elanders has implemented structural cost-saving measures expected to reduce the company's annual cost base by SEK 145 million, which will likely improve net margins over time.
- The company's continued strong cash conversion and reduction of working capital and net debt contribute positively to its financial stability, which could enhance future earnings.
- Growth in the electronics segment and new site development in Asia, particularly the positive trend in Thailand, suggest potential revenue increases as customer demand in these sectors remains strong.
- New customer acquisitions in North America, despite current slowdowns, are expected to start contributing to sales in Q2 and Q3, potentially boosting revenues.
- Elanders is exploring consolidation opportunities in the print segment, particularly in the German market, which may lead to increased operational efficiency and better net margins.
Elanders Future Earnings and Revenue Growth
Assumptions
How have these above catalysts been quantified?
- Analysts are assuming Elanders's revenue will grow by 2.6% annually over the next 3 years.
- Analysts assume that profit margins will increase from 0.5% today to 4.1% in 3 years time.
- Analysts expect earnings to reach SEK 516.8 million (and earnings per share of SEK 10.57) by about July 2029, up from SEK 54.0 million today.
- In order for the above numbers to justify the price target of the analysts, the company would need to trade at a PE ratio of 8.1x on those 2029 earnings, down from 32.1x today. This future PE is lower than the current PE for the GB Logistics industry at 30.1x.
- Analysts expect the number of shares outstanding to remain consistent over the next 3 years.
- To value all of this in today's terms, we will use a discount rate of 10.42%, as per the Simply Wall St company report.
Risks
What could happen that would invalidate this narrative?- Declining demand across customer segments led to negative organic growth, impacting revenue and net margins.
- The Print & Packaging Solutions segment experienced a 6% negative organic growth, significantly affecting the adjusted EBITDA margin and potentially reducing earnings.
- Lower automotive volumes, especially due to reduced exports to China, continued to decrease margin in the automotive segment, affecting overall profitability.
- Trade disputes, particularly between the U.S. and China, create uncertainties for the Supply Chain Solutions and Fashion segment, risking future revenue streams and earnings.
- Structural changes, such as the system change in a major European warehouse, resulted in additional personnel costs, thereby negatively impacting the bottom line and squeezing margins.
Valuation
How have all the factors above been brought together to estimate a fair value?
- The analysts have a consensus price target of SEK88.17 for Elanders based on their expectations of its future earnings growth, profit margins and other risk factors.
- However, there is a degree of disagreement amongst analysts, with the most bullish reporting a price target of SEK97.5, and the most bearish reporting a price target of just SEK69.5.
- In order for you to agree with the analysts, you'd need to believe that by 2029, revenues will be SEK12.7 billion, earnings will come to SEK516.8 million, and it would be trading on a PE ratio of 8.1x, assuming you use a discount rate of 10.4%.
- Given the current share price of SEK48.95, the analyst price target of SEK88.17 is 44.5% higher.
- We always encourage you to reach your own conclusions though. So sense check these analyst numbers against your own assumptions and expectations based on your understanding of the business and what you believe is probable.
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Disclaimer
AnalystConsensusTarget is a tool utilizing a Large Language Model (LLM) that ingests data on consensus price targets, forecasted revenue and earnings figures, as well as the transcripts of earnings calls to produce qualitative analysis. The narratives produced by AnalystConsensusTarget are general in nature and are based solely on analyst data and publicly-available material published by the respective companies. These scenarios are not indicative of the company's future performance and are exploratory in nature. Simply Wall St has no position in the company(s) mentioned. Simply Wall St may provide the securities issuer or related entities with website advertising services for a fee, on an arm's length basis. These relationships have no impact on the way we conduct our business, the content we host, or how our content is served to users. The price targets and estimates used are consensus data, and do not constitute a recommendation to buy or sell any stock, and they do not take account of your objectives, or your financial situation. Note that AnalystConsensusTarget's analysis may not factor in the latest price-sensitive company announcements or qualitative material.
