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Atlas Copco Is Top Tier, But Macro Expectations May Be Too Aggressive

Sep. 21, 2023 4:20 PM ETAtlas Copco AB (ATLKY) StockIR, VACNY4 Comments
Stephen Simpson profile picture
Stephen Simpson


  • Atlas Copco shares continue to outperform, but the macro environment for short-cycle industrial companies is becoming more and more challenging.
  • The Compressor Technique business, which generates half of the company's operating profits, may face weakness due to slowing industrial production across the globe.
  • The uncertainty in the semiconductor equipment sector creates risks for Atlas Copco's Vacuum Technique business; orders have held up better than some comps so far, but the outlook is murky.
  • Atlas Copco will be fine as a company and the long-term prospects are attractive, but I do see a risk of underperformance given where the valuation is today and potential macro-driven headwinds.
Interior Compressor Station


It’s not uncommon to see the shares of cyclical companies, particularly well-run cyclical companies that have made investors a lot of money over the years, be slow to respond to deteriorating underlying end-market conditions. That sets up a situation reminiscent of old

This article was written by

Stephen Simpson profile picture
Stephen Simpson is a freelance financial writer and investor.Spent close to 15 years on the Street (sell-side, buy-side, equities, bonds).

Analyst’s Disclosure: I/we have no stock, option or similar derivative position in any of the companies mentioned, and no plans to initiate any such positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

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Comments (4)

Guraaf profile picture
I plan to add $ATLCY whenever it comes closer to $10. Maybe $9.5.
Stephen Simpson profile picture
@Guraaf When you do that, ping me so that I don't forget! lol
Another Mountain's Rock Investing profile picture
I like Atlas too and agree the price extended. More flat/downside likely at current sp.
takeone1 profile picture
Hi Stephen,
Wyle dealt a lot with Acme..Got any thoughts on that..Great articles as per usual and have a good one!!
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