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Sulzer AG (CH:SUN)
:SUN
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Sulzer AG
(OTC:SUN)
Rating:73Outperform
Price Target:
CHF166.00
▲(14.64% Upside)
Positive Factors
Financial Guidance
Guidance was confirmed with achievable sales growth and margin targets, supported by backlog quality and visibility.
Operational Performance
Sales are up with earnings continuing to improve due to operational improvements and higher service share.
Order Backlog
The backlog increased to CHF2.5bn (+9% QoQ) and bodes well to achieve this year's guidance, which was confirmed, implying +5% order growth for the remainder of the year to meet the mid-point.
Negative Factors
Chemtech Orders
Orders in Chemtech are down -17% YoY to CHF230m against tough comps.
Order Intake
1Q25 orders came in softer as already envisaged, flat YoY to CHF1,020m, -3% vs. cons. and primarily driven by a larger Chemtech order shifting into 2Q as well as high uncertainty in Oil & Gas verticals in the US.
Order Momentum
Order momentum reflects current capital expenditure hesitance across energy verticals.
Sulzer AG (SUN) vs. iShares MSCI Switzerland ETF (EWL)
Market Cap
$4.92B
Dividend Yield2.94%
Average Volume (3M)39.74K
Price to Earnings (P/E)18.0
Beta (1Y)1.18
Revenue Growth5.79%
EPS Growth13.20%
CountryCH
Employees13,455
SectorIndustrials
Sector Strength74
IndustryIndustrial - Machinery
Share Statistics
EPS (TTM)3.74
Shares Outstanding34,262,367
10 Day Avg. Volume29,916
30 Day Avg. Volume39,744
Financial Highlights & Ratios
PEG RatioN/A
Price to Book (P/B)0.00
Price to Sales (P/S)0.00
P/FCF Ratio0.00
Enterprise Value/Market Cap1.04
Enterprise Value/Revenue1.45
Enterprise Value/Gross Profit4.33
Enterprise Value/Ebitda10.32
Forecast
1Y Price Target
$186.47Price Target Upside28.78% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering2
Sulzer AG Business Overview & Revenue Model
Company DescriptionSulzer AG (SUN) is a global industrial engineering and manufacturing company headquartered in Winterthur, Switzerland. The company operates primarily in two sectors: Sulzer Pumps, which focuses on the design and production of pumps and related services for various industries including oil and gas, water and wastewater, and chemicals; and Sulzer Chemtech, which provides separation and mixing technology for processes in the chemical and petrochemical sectors. Sulzer also has a strong presence in the surface solutions market, offering coating services and technologies to enhance the performance and durability of industrial components.
How the Company Makes MoneySulzer AG generates revenue through multiple streams, primarily from the sale of its engineered products, including pumps, mixers, and separation technologies. The company earns money by providing customized solutions and services to its clients, often including installation, maintenance, and after-sales support. Key revenue streams include the provision of equipment and systems for various applications in the oil & gas, water, and chemical industries, as well as long-term service agreements. Significant partnerships with major players in these industries enhance its market reach and stability of earnings. Additionally, Sulzer's focus on innovation and technology development allows it to introduce advanced solutions, further driving revenue growth.
Sulzer AG Earnings Call Summary
Earnings Call Date:Jul 24, 2025
(Q2-2025)
| % Change Since: |
Next Earnings Date:Oct 22, 2025
Earnings Call Sentiment Neutral
The earnings call reflects a mixed sentiment. While there is strong sales growth and improved profitability, challenges in the Chemtech division and currency impacts weigh heavily. The company's strong performance in the Services division and ongoing innovations are positive, but geopolitical uncertainties and project delays present significant challenges.Q2-2025 Updates
Positive Updates
Strong Sales Growth
Sales increased by 6.3% in the first half of 2025, with double-digit growth in Flow (10.3%) and Services (14.8%).
Improved Profitability
Third consecutive year of profitability improvement, with a 90 basis points increase in EBITDA margin to 14.4%.
Positive Order Intake Margins
Order intake margin increased by 210 basis points, indicating high-quality orders.
Strong Service Division Performance
The Services division showed double-digit growth in sales and order intake, with sales increasing by 15%.
Innovation and Environmental Technologies
Sulzer is investing in innovations like hydraulic power recovery turbines to improve energy efficiency and launched specialized services for energy optimization.
Negative Updates
Chemtech Division Challenges
Sales in the Chemtech division declined by 13.6%, with order intake down by 20% due to geopolitical uncertainties and overcapacity in Asia, particularly in China.
Impact of Currency Fluctuations
The Swiss franc's appreciation against the dollar by 15% since January 2025 negatively impacted sales and order backlog.
Project Delays and Cash Flow Impact
Project delays due to geopolitical uncertainties led to an increase in inventory and accounts receivables, impacting cash flow.
Flat Sales in the U.S.
Despite a booming energy and electricity market in the U.S., Sulzer's sales remained flat, partly due to currency effects.
Company Guidance
During Sulzer's Half Year 2025 results presentation, the company reaffirmed its midterm financial goals of an EBITDA margin above 17% and a return on capital employed above 22%, despite challenging geopolitical conditions and currency fluctuations. Sulzer reported a 6.3% increase in sales in the first half of 2025, with the Flow and Services divisions achieving double-digit growth of 10.3% and nearly 15%, respectively. However, the Chemtech division experienced a 13.6% decline in sales due to geopolitical uncertainties and overcapacity in Asia's refining sector. Order intake for Services rose by 12%, while Flow saw a normalized increase of 2% when adjusting for a significant order from the previous year. The company's EBITDA margin improved by 90 basis points to 14.4%, with a potential increase of 120 basis points when excluding the impact of currency fluctuations. Sulzer expects full-year order intake to rise between 2% and 5%, sales to grow between 5% and 8%, and the EBITDA margin to exceed 15%.Sulzer AG Financial Statement Overview
Summary
Sulzer AG shows strong financial performance with consistent revenue and profit growth, stable margins, and effective cash flow management. The balance sheet is healthy with manageable debt levels, though monitoring leverage is advised.Income Statement
Sulzer AG has shown consistent revenue growth with a Revenue Growth Rate of 7.6% from 2023 to 2024. Its Gross Profit Margin is solid at 33.5% and Net Profit Margin at 7.4% in 2024, indicating strong profitability. The EBIT Margin of 10.8% and EBITDA Margin of 14.2% also highlight efficient operations. The company's income statement reflects a healthy growth trajectory and profitability, although there was a dip in net income in 2021 due to one-off factors.85
Very Positive
Balance Sheet
The company's Debt-to-Equity Ratio is 0.95 in 2024, which is reasonable for the industry, showing balanced leverage. The Return on Equity (ROE) is strong at 21.4%, indicating efficient use of equity to generate profits. The Equity Ratio is 25.9%, suggesting a moderate reliance on equity financing. Overall, the balance sheet is stable, but the company should monitor its debt levels to maintain financial flexibility.78
Positive
Cash Flow
Sulzer AG's Free Cash Flow increased by 4.4% from 2023 to 2024, supporting growth and investment. The Operating Cash Flow to Net Income Ratio is 1.24, indicating strong cash conversion from profits. The Free Cash Flow to Net Income Ratio is 0.88, showing a solid capacity to fund operations and growth initiatives. Cash flow management is robust, supporting business sustainability.80
Positive
| Breakdown | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|---|
Income Statement | |||||
| Total Revenue | 3.53B | 3.28B | 3.18B | 3.16B | 2.97B |
| Gross Profit | 1.18B | 1.08B | 939.60M | 946.90M | 872.50M |
| EBITDA | 503.00M | 440.00M | 250.10M | 334.80M | 261.20M |
| Net Income | 261.90M | 229.10M | 28.60M | 1.42B | 83.60M |
Balance Sheet | |||||
| Total Assets | 4.71B | 4.37B | 4.70B | 5.08B | 5.43B |
| Cash, Cash Equivalents and Short-Term Investments | 1.06B | 977.00M | 1.21B | 1.53B | 1.43B |
| Total Debt | 1.16B | 1.15B | 1.44B | 1.60B | 1.84B |
| Total Liabilities | 3.48B | 3.27B | 3.67B | 3.80B | 4.01B |
| Stockholders Equity | 1.22B | 1.10B | 1.02B | 1.27B | 1.40B |
Cash Flow | |||||
| Free Cash Flow | 231.40M | 296.60M | 49.50M | 230.30M | 263.20M |
| Operating Cash Flow | 323.80M | 362.20M | 119.30M | 316.40M | 368.70M |
| Investing Cash Flow | -98.20M | -104.80M | -87.00M | 414.50M | -461.80M |
| Financing Cash Flow | -151.60M | -448.60M | -286.30M | -365.20M | 236.50M |
Sulzer AG Technical Analysis
Negative
144.80
Price Trends
150.19
Negative
148.49
Negative
143.45
Positive
Market Momentum
-1.88
Positive
36.16
Neutral
6.48
Positive
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For CH:SUN, the sentiment is Negative. The current price of 144.8 is below the 20-day moving average (MA) of 151.96, below the 50-day MA of 150.19, and above the 200-day MA of 143.45, indicating a neutral trend. The MACD of -1.88 indicates Positive momentum. The RSI at 36.16 is Neutral, neither overbought nor oversold. The STOCH value of 6.48 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for CH:SUN.
Sulzer AG Peers Comparison
Overall Rating
UnderperformOutperform
Sector (64)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
73 Outperform | $4.92B | 18.03 | 23.37% | 2.94% | 5.79% | 13.20% | |
70 Outperform | CHF2.45B | 32.82 | 1.89% | 11.43% | 6.46% | ||
68 Neutral | CHF1.90B | 31.95 | 1.45% | -3.67% | -12.95% | ||
66 Neutral | CHF947.36M | 16.34 | 6.81% | -17.75% | ― | ||
64 Neutral | $10.73B | 15.74 | 7.56% | 2.01% | 2.76% | -15.10% | |
63 Neutral | CHF3.85B | 17.08 | 2.92% | -11.64% | -24.17% | ||
60 Neutral | CHF5.14B | 18.55 | 2.10% | -24.42% | 32.48% |
* Industrials Sector Average
Performance Comparison
CH:SUN
Sulzer AG
144.80
25.58
21.46%
CH:OERL
OC Oerlikon Corporation AG
2.93
-1.38
-32.02%
CH:KARN
Kardex AG
319.00
65.64
25.91%
CH:INRN
Interroll Holding AG
2,300.00
-169.56
-6.87%
CH:BUCN
Bucher Industries AG
381.50
50.50
15.26%
CH:GF
Georg Fischer AG
64.20
2.77
4.51%
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.