Talking Shop: Thoughts on the Flora sale process; Carrefour's profit warning; Downgrading Essity to Neutral; 3Q results Week Two

3Q26 earnings season has begun in earnest and, beyond the usual reporting round-up, we consider the Flora sale process, where first-round bids were reportedly submitted this week. In our view, a secondary LBO of the business—the prospective buyers listed are all financial sponsors—is anything but straightforward; we present a scenario that may help solve KKR's equity problem but would not result in fresh capital to delever the Flora credit. Carrefour cut FY26 guidance across the board, with underlying operating margin expansion now expected at 0-15bp versus 25bp previously, citing French unrest; we remain Underweight. Sainsbury's delivered in-line interim profit and raised the lower bound of FY26 guidance; Nestlé beat expectations and reiterated guidance; Kering missed, with Gucci organic sales down 6%; and Essity delivered a mixed update, prompting our downgrade to Neutral on rising margin headwinds and unattractive relative value.