Guidance shift vs. prior outlook and consensus
FLSmidth’s 2025 update lifts the adjusted EBITA margin target but trims the top‑line revenue forecast. In the last guidance round the company had projected a 2025 adjusted EBITA margin of roughly 12‑13% on a revenue base of €2.3‑2.4 bn. The new statement now points to a margin in the 13‑14% range while the revenue ceiling has been pulled back to about €2.1‑2.2 bn. The margin upgrade represents a modest but meaningful upside (≈ 100 bp) relative to the prior outlook, whereas the revenue downgrade is a 5‑8% cut versus the earlier estimate.
Market participants had been pricing in a “steady‑state” 2025 outlook, with analysts on average still expecting the 12‑13% margin and the higher €2.3 bn revenue (Consensus: 12.5% margin, €2.33 bn revenue). The margin lift is therefore ahead of expectations, but the revenue reduction is a surprise on the downside. The net effect is a mixed signal: profitability per unit is improving, yet the top‑line growth engine is weaker than the market had priced in.
Trading implications
- Short‑to‑mid‑term: The revenue shortfall is likely to pressure the stock on the downside, especially if the market views the lower sales as a sign of a softer order pipeline. Expect a modest sell‑off on the next session, with the price testing the recent 1‑month low‑volume support around the 30‑day moving average.
- Long‑term: The upgraded margin points to a higher‑margin operating model that could sustain earnings if the company can offset the lower volume with cost‑efficiency or higher‑value contracts. Investors with a bias toward earnings quality may consider a partial position at the dip, targeting a 6‑8 % upside if the margin upgrade translates into a beat‑the‑consensus Q4‑2024 result.
- Risk management: Keep a stop‑loss just below the 20‑day EMA (≈ 2–3 % below the entry) to guard against further downside if the revenue contraction deepens. Monitor upcoming order‑book updates and any forward‑looking commentary on pricing power, which will be the key catalyst for a sustained rally.