A Look at Electrolux (OM:ELUX B) Valuation Following Its Return to Profitability and Strategic Restructuring

AB Electrolux (OM:ELUX B) returned to profitability in the third quarter of 2025, reporting improved operating income and a net profit compared to a loss last year. The company also introduced a new organizational structure and adjusted its business outlook.

See our latest analysis for AB Electrolux.

Despite a remarkable turnaround in profitability and the recent organizational shake-up, AB Electrolux’s share price remains well below where it started the year. While the stock saw an impressive 18.8% gain over the last month, momentum has not fully reversed last year’s slide. Its total shareholder return is still down 31.1% for the past 12 months. Short-term optimism is building following the earnings beat, but longer-term returns remain under pressure as investors weigh the pace of recovery against ongoing competitive challenges.

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But after the swift rebound in earnings and a share price still trading at a sizable discount to analyst targets, is Electrolux now an undervalued buy, or is the market already factoring in its recovery potential?

Most Popular Narrative: 17.6% Undervalued

With AB Electrolux’s fair value estimate set at SEK 74.50, well above the last close of SEK 61.40, the narrative points to meaningful upside if the company achieves its forecasted improvements. Investors are watching closely as the stock’s discounted price reflects a balance of optimism and skepticism about the company’s ability to deliver on these ambitious targets.

Persistent gains in North American market share, improved local manufacturing, and the ability to push through targeted price increases in response to tariffs position Electrolux to benefit from ongoing urbanization and rising middle-class wealth in this region. This is likely to drive sustained organic revenue and EBIT growth as market conditions stabilize.

Read the complete narrative.

Want to know which bold expectations could unlock this discount? The answer is a set of forecasts tied to aggressive earnings, margin expansion, and a profit multiple that may surprise you. Curious what’s fueling this double-digit upside? Read the full narrative for the details.

Result: Fair Value of $74.50 (UNDERVALUED)

Have a read of the narrative in full and understand what's behind the forecasts.

However, persistent European market weakness and ongoing price competition from low-cost rivals could threaten Electrolux’s premium-focused recovery in the near term.

Find out about the key risks to this AB Electrolux narrative.

Build Your Own AB Electrolux Narrative

Of course, if you see things differently or want to test your own assumptions, you can dive into the numbers and create your personal story in under three minutes. Do it your way

A great starting point for your AB Electrolux research is our analysis highlighting 3 key rewards and 2 important warning signs that could impact your investment decision.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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