Afry came into Q3 2026 trading at SEK120.9 after a strong three month run, with investors buying into the story of an engineering consultant turning operational clean up into real earnings power. The fresh report offers a cooler reality. Revenue for the quarter landed at SEK5,793m, while basic earnings per share printed at SEK1.80. The headline beat is the EBITA margin improving to 6.8% as utilization edges closer to target. The stock move now reflects a clash between that margin progress and lingering questions about how fast organic demand really recovers.
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Q3 2026 Earnings Summary
- Revenue (Q3 2026 vs Q3 2025): SEK5,793m vs. SEK5,687m (up roughly 1.9%)
- Net Income, excl. extra items (Q3 2026 vs Q3 2025): SEK204m vs. SEK137m (up about 48.9%)
- Basic EPS (Q3 2026 vs Q3 2025): SEK1.80 vs. SEK1.21 (up around 48.9%)
- EBITA Margin (Q3 2026 vs Q3 2025): 6.8% vs. 6.4% (improved by 0.4 percentage points)
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Afry Bull Case: Margin Levers Finally Start To Bite
The bullish script argues Afry’s clean up and mix shift should translate into structurally stronger profitability, not just a one quarter bump.
"The main factor that has to go right is that Afry converts its completed restructuring, improving utilization and portfolio shift away from weaker automotive, pulp & paper and real estate work into sustained margin expansion while managing price pressure in challenged segments."
Q3 edges that thesis forward. Utilization at 72.9% sits close to the 74% ambition and EBITA margin reached 6.8%, with rolling 12‑month EBITA around 7.4%. Energy and AMC driven advisory work helped lift profitability, even while adjusted organic sales still declined 1.5%, which suggests margin levers are working without relying on volume recovery yet.
One Narrative has put a figure on that disagreement. → See the Narrative with its higher Fair Value, assumptions and all.
Afry Bear Case: Backlog Still Not Feeding Growth
Worried investors argue that Afry’s execution engine is too weak to turn record backlog into real top line momentum.
"recent adjusted organic sales declines suggest execution bottlenecks or client delays could prevent backlog from translating into group-level revenue growth."
Q3 does not clear that hurdle. Adjusted organic sales still declined 1.5% even with backlog at SEK22.1b and fresh LNG power and grid wins arriving in Energy. Margin and utilisation progress point in the right direction, yet the core bear worry, sales conversion from a strong project pipeline, remains unresolved in these numbers.
Hunt For Mispriced Earnings Power
Afry shows how margin repair can outpace clean revenue momentum for a long stretch. The real opportunity sits in finding stocks that could be undervalued before the next rerating hits.
- Company 1 - 31% below our estimate - uses tighter filters on secured retail, agriculture and MSME loans while rolling out new branches to deepen low cost deposits.
- Company 2 - 22% below our estimate - shifts from export-heavy refining toward an integrated fuel supplier by expanding domestic retail outlets and investing in efficiency projects including grid power import and a bio-ATF plant.
- Company 3 - 32% below our estimate - leans into higher-margin data center and harsh environment fiber solutions while adding submarine cable capacity to balance weaker demand in legacy European fiber projects.
That is three of the list. See all 191 potentially undervalued companies →
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