Is Husqvarna (OM:HUSQ B) Cheap On Its New 400 Series Chainsaw Launch?
Husqvarna (OM:HUSQ B) just expanded its 400 series chainsaw range with three new models, including the AutoTune equipped 450X Rancher. This development gives investors fresh context for assessing the stock after a weak year.
For Husqvarna shareholders, the new chainsaws arrive against a backdrop of pressure on the stock. The share price is at SEK37.13, with the 30-day share price return down 5.52% and the year-to-date share price return down 20.25%, while the 1-year total shareholder return has declined 26.46%. Overall, momentum has been fading for several years. The 3-year total shareholder return is down 52.24% and the 5-year total shareholder return is down 63.73%, despite periodic product launches like this one aiming to support the long-term story.
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Husqvarna now trades after a steep multi year slide, yet still rolls out higher spec products like the AutoTune equipped 450X Rancher. Has most of the rerating already happened, or does the current valuation still leave meaningful upside?
Most Popular Narrative: 13.7% Undervalued
Husqvarna is priced at SEK37.13 while the most followed narrative anchors fair value at SEK43, which frames the 400 series chainsaw launch in a very different light.
The accelerating transition towards battery-powered, electric, and especially robotic outdoor equipment is expanding Husqvarna's addressable market and supporting double-digit sales growth in robotics and electrified categories, which is expected to drive above-average revenue growth and higher net margins as a greater share of sales comes from higher-ASP, lower-servicing products.
Curious what sits behind that rerating story. The narrative leans hard on faster earnings growth, a modest revenue lift, and a lower future earnings multiple than today. The mix of robotics, margins, and the discount rate does the heavy lifting in that SEK43 fair value.
Result: Fair Value of SEK43 (UNDERVALUED)
Have a read of the narrative in full and understand what's behind the forecasts.
Still, that story can break if weak North American demand persists, or if low cost robotics competitors keep forcing Husqvarna into deeper price cuts.
Find out about the key risks to this Husqvarna narrative.
Next Steps
Sentiment around Husqvarna is clearly mixed right now, so look through the numbers, weigh the concerns against the potential, and then check the 4 key rewards and 1 important warning sign.
Looking for more ideas beyond Husqvarna?
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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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