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Stock Analysis & ValuationLeifheit AG (0F2Z.L)

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£15.40
Sector Valuation Confidence Level
Moderate
Valuation methodValue, £Upside, %
Artificial intelligence (AI)14.00-9
Intrinsic value (DCF)6.17-60
Graham-Dodd Methodn/a
Graham Formula6.40-58

Strategic Investment Analysis

Company Overview

Leifheit AG is a leading German manufacturer and distributor of household and wellbeing products, with a strong heritage dating back to 1868. Headquartered in Nassau, Germany, the company operates through three key segments: Household (laundry care, cleaning, and kitchen goods under the Leifheit brand), Wellbeing (health care and air treatment products under the Soehnle brand), and Private Label (laundry and kitchen goods under Birambeau and Herby brands). Leifheit serves markets across Germany, Central and Eastern Europe, and internationally, leveraging both traditional retail and e-commerce channels. As a consumer cyclical company in the apparel retail industry, Leifheit benefits from brand recognition and a diversified product portfolio catering to everyday household needs. The company’s long-standing reputation for quality and innovation positions it well in the competitive household goods sector.

Investment Summary

Leifheit AG presents a stable investment opportunity within the consumer cyclical sector, supported by its well-established brands and diversified product offerings. The company’s solid financials, including a market cap of €198.1M, revenue of €259.2M, and net income of €8.04M in the latest fiscal year, reflect its operational resilience. With a healthy operating cash flow of €28.5M and minimal debt (€1.72M), Leifheit maintains a strong balance sheet. The dividend yield, supported by a €1.05 per share payout, adds appeal for income-focused investors. However, its beta of 1.163 suggests moderate volatility, and competition in the household goods space remains intense. Investors should weigh its brand strength against potential margin pressures from rising input costs and shifting consumer preferences.

Competitive Analysis

Leifheit AG competes in the household and wellbeing products market with a focus on brand differentiation and quality. Its competitive advantage lies in its long-standing reputation (since 1868) and a diversified portfolio spanning laundry care, cleaning, kitchen goods, and health products under well-recognized brands like Leifheit and Soehnle. The company’s dual approach—combining branded products with private-label offerings—allows it to cater to both premium and value-conscious consumers. However, Leifheit faces stiff competition from global giants and regional players, which may have broader distribution networks and economies of scale. Its relatively small market cap (€198.1M) limits its ability to compete on pricing or marketing spend compared to larger rivals. The company’s focus on DACH and Central/Eastern Europe provides regional strength but may limit growth compared to competitors with a more global footprint. Strengths include strong cash reserves (€41.4M) and low debt, but innovation and e-commerce expansion will be critical to maintaining relevance in a rapidly evolving retail landscape.

Major Competitors

  • Reckitt Benckiser Group (RB.L): Reckitt Benckiser is a global leader in household and health products, with brands like Lysol and Finish. Its vast scale and R&D capabilities give it a significant edge in innovation and marketing. However, its focus on mass-market products may leave room for Leifheit’s niche brands in premium segments.
  • Henkel AG & Co. KGaA (HEN3.DE): Henkel dominates the European household goods market with brands like Persil and Pril. Its strong retail partnerships and pricing power pose a challenge to Leifheit. However, Henkel’s broader industrial operations dilute its focus on consumer goods compared to Leifheit’s specialized approach.
  • Procter & Gamble (PG): P&G’s global presence and extensive product portfolio (e.g., Tide, Swiffer) make it a formidable competitor. Its massive advertising budget and supply chain efficiency overshadow Leifheit’s regional operations. However, Leifheit’s localized brand appeal and private-label segment offer differentiation.
  • Shire Plc (SHP.L): Shire’s focus on health and hygiene products overlaps with Leifheit’s Wellbeing segment. While Shire has a stronger pharmaceutical slant, Leifheit’s Soehnle brand competes in consumer health categories like air treatment and scales.
  • Fressnapf Holding SE (FRE.DE): Fressnapf’s private-label pet care products indirectly compete with Leifheit’s Birambeau and Herby lines. While not a direct rival, Fressnapf’s success in private labels highlights the competitive pressure in this segment.
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