Thermador 2024 numbers
Thermador launched 2024 numbers final Friday. Essentially the most optimistic a part of the discharge is the truth that Thermador manages to place every part you might want to know on two pages with none BS. The numbers have been clearly not good, with gross sales down -13,5% in 2024 and revenue down -23,3%:
On the optimistic aspect, Thermador appears to proceed to search for acquisition targets:
At a 2024 P/E of 13,3, Thermador is neither tremendous low cost nor tremendous costly. In the meanwhile I’ll sit on my arms, but when the share worth would go beneath 60 EURper share, I’d add on an opportunistic foundation.
Some ideas on (European) Defence shares
Not too surprisingly, European Defence shares have been on a tear already for a while, solely to additional speed up on the time of writing following the Shitshow that occurred in Mr. Trump’s places of work on Friday.
For me, Defence shares all the time have been troublesome as they’re typically depending on primarily one group of consumers (Governements) and depend on rare giant orders with vital “covenants”. The listing of disappointments for these shares is lengthy.
Nonetheless, Defence shares are clearly the momentum shares of the second, because the charts of those chosen European shares present:
Rheinmetall, the German tank and ammunition producer is a 13 bagger over the previous 5 years. Even corporations which have actual issues and just some publicity to Defence, resembling Thyssenkrupp are actually in “vertical mode”:
One query I’ve to ask myself is clearly: Wouldn’t it have been one way or the other sensible and a type of “hedge” to personal a number of the names because it was clear that Trump gained the election within the US ? In excellent hindsight, this appears apparent. One thing to recollect for the subsequent comparable scenario. Diversification isn’t a foul factor in unstable occasions.
The subsequent query could be: Does it make sense to leap on that Defence FOMO practice proper now ?
I suppose that very a lot is determined by the time horizon one is . Personally, I’m actually a brilliant dangerous quick time period momentum investor. Additionally basically, it isn’t so clear to me to what lengthen and how briskly the income of the Defence corporations will enhance.
Rheinmetall for example trades at a trailing P/E of round 70x. Wanting on the final 23 years, we will see that on common, EBIT margins have been single digits and ROCE at finest at 15%.
Sure, EBIT margins did enhance and would possibly enhance some extra however for me the massive query is the next: There will probably be clearly a increase in defence spending for a few years however then what ?
This can be a capital intensive trade and Rheinmetall & Co will want to spend so much on PP&A. However until there’s a full blown conflict and/or the Ukraine conflict massively escalates, after a couple of years, Europe could have beefed up its defence capabilities considerably after which the required capability will drop considerably becasue you don’t substitute your tanks or ammunation each 3-5 years.
One other damaging state of affairs could be that the US/Trump strain Europe to massively purchase American weapons with a view to keep away from punitive tariffs. I feel this state of affairs shouldn’t be so unlikely and may also restrict the upside for the European rivals within the mid time period.
To me, the present defence increase appears slightly bit just like the Renewables increase from 2022 when Russia attacked Ukraine:
Renewable Power was hailed as the long run answer (“independence vitality”) and an extended and affluent future was virtually assured. Now, 3 years later, ,ost Renewable gamers misplaced -50% to -60% from their peak and are buying and selling decrease than when the conflict started and the fuel was shut off.
For me personally, I can’t make investments into these puffed up protection shares. In fact they will simply go up one other 20%, 30% and even 50%, however within the mid-term, I suppose they’re greater than pretty valued on a elementary foundation. And as I discussed: I’m not superb on timing these quick time period “FOMO” strikes.
There could be alternatives alongside the worth chain, however in the meanwhile I’ll follow my boring & underperforming “high quality” small caps.
