KNYJY - KONE: Adjusting To The End Of China's Construction Boom
- Kone set out its new strategy and expectations at its investor day last week, following disappointments in both its share price and P&L.
- The elevator industry is facing the end of China's construction boom and high inflation. 35% of Kone's sales were from China in 2021.
- Kone's new strategy is to focus on Services sales as its new growth driver. It is also pursuing price hikes and cost improvements.
- New financial expectations imply annual sales growth of approx. 4% and, in our estimates, annual EBIT growth of approx. 7%.
- With shares at €48.11, we expect a total return of 43% (11.1%annualized) by 2025. The Dividend Yield is 3.6%. Buy.
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KONE: Adjusting To The End Of China's Construction Boom