Milwaukee momentum underpins growth: Replacement, restocking and AIDC demand drive earnings growth

Research evidence excerpt

Milwaukee momentum underpins growth: Replacement, restocking and AIDC demand drive earnings growth

Global Markets Research

Techtronic Industries 0669.HK 669 HK 14 July 2026

EQUITY: CAPITAL GOODS

RatingMilwaukee momentum underpins growth Remains Buy

Target priceReplacement, restocking and AIDC demand drive Increased from HKD 163.00earnings growth HKD 140.00

1H26F preview: Data center and replacement demand support sales growth Closing14 July 2026price HKD 125.50

We expect Techtronic (TTI) to deliver 11.2% y-y 1H26F earnings growth, supported by: (i)

data center construction spending (according to Census, data center construction rose Implied upside +29.9%

22.1% y-y in Jan-May 2026); (ii) likely emerging replacement demand, as the previous

sales growth peak occurred in 2020-21 and the replacement cycle typically runs about Market Cap (USD mn) 29,271.9

five-seven years, based on our estimates; and (iii) margin-accretive Milwaukee potentially ADT (USD mn) 85.3

extending its lead at Home Depot (HD US, Not rated), where we estimate TTI held around

48-49% power tool sales share in 1H26F. In addition, the suspensionoftheHart Relative performance chart

business in Dec-25 likely dragged 1H26F y-y revenue growth and resulted additional

expenses; however, the company's growing focus on Milwaukee and Ryobi as its two

core brands should support a better group net margin in the long run.

2H26F: Encouraging 4Q26F outlook may point to restocking

We estimate HD’s Jun-26 inventory level was at a similar or even at a lower level y-y.

Considering potentially strong 4Q26 sell-through — our industry survey suggests over

10% y-y growth for the overall power tool business in 4Q26F, helped by Black Friday and

gift-center promotions and new product launches — we believe 3Q26F could see