Humble – a new holding
The fund adopted Humble as a new holding this month. We believe its acquisitions help to reduce the risk of any individual product or category falling away, without missing out on market growth in the various niches. At the same time, there are large synergies in utilizing the distribution channels of new and old subsidiaries, especially geographically. We believe that retailers view Humble’s products positively and also that consumers are increasingly focusing on health and the environment. In addition, there have been several insider purchases during the year, particularly recently.
Exposure to Electrolux has increased. We are expecting a series of dividends, extra distributions and buybacks in short order, followed by a period in which we believe margin improvements will be priced in. In other words, we like Electrolux for several reasons and dare to look beyond one or two troubled quarters, while the market thinks the opposite. We believe the reason why the company is one of the most shorted in the Nordics is precisely due to upcoming quarterly reports.
The fund’s exposure to Lindab also increased during the month. Business streamlining, raised financial targets, an improved ESG profile and insider purchases strengthen our case. Under new management, the company has been quick to pass on raw material costs, which reduces the risk, while at the same time increasing its acquisition rate. The ventilation market is growing structurally, and we believe the market underestimates both organic and acquired growth in the future.