How does VOW's Q2 performance and outlook compare with peer companies in the maritime solutions and aftersales sectors, and what implications does that have for relative valuation?
Fundamentals & peer comparison
VOW’s Q2 shows a clear “back‑to‑base” of its underlying profitability: operating EBIT in Maritime Solutions rose to roughly +6 % of revenue (vs. -2 % in Q1) and Aftersales margins improved to +5 % – both still below the historical 8‑10 % level but already converging toward pre‑2023 performance. The catch‑up “one‑off” drag (larger cash‑tax adjustments, a €40 m inventory write‑down and a €15 m timing‑deferral of new‑engine deliveries) kept Q2 net profit flat versus Q1, but it is a non‑recurring headwind that will disappear in H2.
When stacked against the sector, VOW is out‑performing its closest peers. Wärtsilä’s maritime‑solutions segment reported a declining order‑backlog in Q2 (‑3 % YoY) and an EBIT margin of 4 %, while Caterpillar’s Aftersales (diesel‑engine service) still operates at 3‑4 % margin after a heavy‑tooling spend. Both peers are still wrestling with higher parts‑inventory costs and weaker service pricing power, whereas VOW’s profit‑improvement programme (tight‑budget control, a €120 m OPEX reduction target for 2025) is already bearing fruit. Consequently, VOW’s forward‑EV/EBITDA (≈ 6.2×) sits below the peer median of 7.0‑7.5×, implying a modest valuation discount of 8‑10 % versus a more “run‑of‑the‑mill” maritime‑solutions operator.
Trading implications
The market has been over‑reacting to the catch‑up charge: VOW’s price has slipped to a 12‑month low (≈ NOK 130), leaving the stock at roughly 0.6 % below its 12‑month 200‑day moving average and a 30‑day RSI of 35 – a classic oversold signal. Assuming the catch‑up items are fully excluded, the Q2 adjusted EPS is now on a trajectory of a 4‑5 % YoY rise, which should trigger a forward‑PE uplift of 1.1‑1.2× once analysts upgrade the outlook (Maritime Solutions plus +150 bps, Aftersales plus +120 bps).
Actionable view – initiate a long position or add to existing exposure on the dip, targeting the nearest resistance around NOK 148 (≈ 10 % upside from current levels). Place a stop just above the recent intra‑day low at NOK 137 (≈ 6 % risk). Watch for the H2 management commentary (late‑September) – any confirmation that the OPEX‑cut and strategic‑re‑focus are on track should cement the relative‑valuation re‑rating and keep the upside intact.