Koninklijke Ahold Delhaize NV (AD.AS): Guidance cut to trigger severe de-rating

Ahold-Delhaize reported relatively in-line 3Q results with rather downgraded expectations into the print, with US subdued implied volumes denting margins. Management downgraded its FY26 Outlook on all accounts: underlying operating margin approaching 4.0% (previously around 4.0%); low-single-digit diluted underlying EPS growth at constant exchange rates (previously mid- to high-single-digit); and free cash flow of around EUR 2.1 billion (previously at least EUR 2.3 billion). According to the company, the main reason behind the shortfall is the impact from Cyber (EUR 75-100mn underlying operating profit impact), albeit it also admits new supplier payment regulations in Serbia impacting FCF. We estimate the new Outlook implies HSD% EPS downgrades, 20-25bps margin shortfall and EUR 200-300mn FCF haircut. We had placed the shares on Negative Catalyst Watch in early October, and also on our AFL in early May as the cracks in the investment case were appearing more evident, dragged by worseni