FLSmidth & Co. A/S: Solid Balance Sheet, Strong Q4 Momentum and Conservative Margin Guidance Support Buy Rating

In a report released today, David Farrell from Jefferies maintained a Buy rating on FLSmidth & Co. A/S, with a price target of DKK540.00.

David Farrell has given his Buy rating due to a combination of factors that underscore both earnings quality and future optionality for FLSmidth & Co. A/S. Despite weaker-than-expected cash flow from operations and a resulting Net Debt to EBITDA of 0.8x, he views the balance sheet as solid and emphasizes the strong capital return signal from the recently extended DKK 1bn share buyback programme.

Farrell also highlights the standout 4Q performance, with an 18.0% adjusted EBITA margin and order intake growing 19% organically, yielding a book-to-bill ratio above one. He sees these trends as evidence of operational leverage and resilient demand, suggesting the current FY26F margin guidance of 15.5%–16.5% could prove conservative if large project orders return in the second half, supporting further upside for the shares.

Farrell covers the Industrials sector, focusing on stocks such as Chemring, FLSmidth & Co. A/S, and Metso Outotec. According to TipRanks, Farrell has an average return of 13.0% and a 68.86% success rate on recommended stocks.

In another report released on February 5, Kepler Capital also maintained a Buy rating on the stock with a DKK550.00 price target.