Core Insights - Electrolux Professional Group has agreed to acquire the assets of Royal Range, a US commercial cooking company, which is expected to enhance Electrolux's cooking platform in the US market [1][3] - The acquisition aims to expand Electrolux's product offerings by integrating new product categories from Royal Range, leveraging Electrolux's strong sales force to boost sales [1][2] Company Overview - Royal Range, established in 1995, specializes in designing and producing cooking equipment such as ranges, ovens, fryers, and countertop cooking appliances, operating with approximately 40 employees from a factory in Eastvale, California [2] - The company is projected to achieve sales of around SEK 100 million in 2025, with an EBITA margin that is expected to be accretive to Electrolux's target EBITA margin of 15% [3] Acquisition Details - The purchase price for the acquisition has not been disclosed, and the transaction is anticipated to close in the first quarter of 2026 [3]

Core Thesis - The Middleby Corporation (MIDD) is viewed positively due to its potential for growth driven by replacement cycles, strategic spin-offs, and operational improvements, with an intrinsic value estimated at $160, potentially rising to $220 in a bullish scenario [4]. Company Overview - Middleby Corporation is a global leader in food equipment, operating in Commercial Foodservice (CFS), Food Processing (FP), and Residential Kitchen (RK) segments [2]. - The company achieved a 39.7% CAGR from 2001 to 2016 under previous leadership, but growth has slowed since then, with an 11.8% total return over the past 8.5 years [2]. Segment Analysis - The CFS segment includes ovens, fryers, and refrigeration, serving major clients like McDonald's and Burger King, with demand driven by replacement cycles and new builds [3]. - The FP segment, which is set for a spin-off in 2026, focuses on processing for protein and bakery products, while the RK segment targets premium residential products [3]. Management Initiatives - Recent management strategies include revamping go-to-market approaches, aligning sales incentives, and focusing on technology-driven acquisitions [4]. - Long-term projections suggest organic growth of approximately 2-2.5% and EBIT CAGR of around 4.8% through 2035, with an anticipated $7 billion in free cash flow for shareholder returns [4]. Market Valuation - At a share price of $132, the market is perceived to undervalue the company’s upcoming replacement cycles and operational improvements, with a significant upside potential [4].

Core Insights - Whirlpool reported Q2 2025 results with ongoing earnings per share (non-GAAP) of $1.34, missing the consensus estimate of $1.68, and revenue of $3,773 million, below the expected $3,846.88 million [1][2] - Both ongoing earnings per share and revenue showed declines compared to Q2 2024, with ongoing earnings per share down 43.9% and revenue down 5.4% year over year [1][2] - Management attributed the quarter's performance to competition from Asian imports and weak consumer demand, while maintaining its full-year outlook [1] Financial Performance - Ongoing earnings per share (non-GAAP) fell from $2.39 in Q2 2024 to $1.34 in Q2 2025, a decrease of 43.9% [2][5] - GAAP net earnings dropped by 70.5% year-over-year, with operating cash flow (GAAP) and free cash flow (non-GAAP) both negative, at ($856 million) for the first half of 2025 compared to ($713 million) in the prior year [2][5][6] - The ongoing EBIT margin remained stable at 5.3%, but net earnings were significantly impacted by a $19 million loss from a Beko Europe equity investment [6] Business Strategy - The company focuses on reshaping its business portfolio, accelerating product innovation, and optimizing costs, including divesting low-margin operations and launching over 100 new products in 2024 [4][7] - The company has exited its European major appliance operations and continues to prioritize portfolio simplification despite legacy costs affecting results [7] - New product launches, such as the KitchenAid induction cooktop and JennAir built-in wall oven, have supported direct-to-consumer sales growth, particularly in small appliances [7] Market Performance - North American major appliance sales declined by 4.7%, with EBIT down 11.7% year-over-year, while Latin America saw a 10.0% sales decline [6] - In Asia, sales fell by 5.9% year-over-year, but profits increased by 11.2% year-over-year, indicating a mixed performance across regions [6] Capital Structure and Outlook - The company refinanced $1.2 billion in term debt at an interest rate of approximately 6.3%, with net debt remaining elevated and cash reserves at $1.07 billion [8] - Management reaffirmed FY2025 guidance for ongoing earnings per share between $6.00 and $8.00, ongoing EBIT margin of approximately 5.7%, and free cash flow guidance set at $400 million for the full year [10] - The company plans to monitor cash flow, debt repayment, and inventory normalization as the year progresses [11]