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AFRY AB Class B (SE:AFRY)
:AFRY

AFRY AB Class B (AFRY) AI Stock Analysis

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AFRY AB Class B

(OTC:AFRY)

Rating:70Outperform
Price Target:
kr187.00
▲(13.40%Upside)
AFRY AB Class B shows solid financial performance, particularly in cash flow management and profitability margins, which contributes significantly to its overall score. Technical analysis indicates mixed market momentum, and the valuation metrics suggest the stock is fairly priced with a decent dividend yield. The absence of earnings call and corporate events data limits the analysis to these key areas.
Positive Factors
Financial Performance
Profitability was somewhat better than expected, thanks to margin improvements in Infrastructure and Energy.
Leadership
Linda Pålsson has been appointed as the new President and CEO, effective immediately, and appears to be a strong fit for this leadership position.
Sector Performance
Strong growth in the Energy sector was driven by continued robust demand and high activity in all business areas.
Negative Factors
Earnings
AFRY's 1Q25 was weaker-than-expected, with net sales falling short of expectations and a noticeable drop in adjusted EBITA.
Market Demand
The market shows varied demand, with strong areas like energy and transport infrastructure being offset by weaker areas such as pulp and paper, real estate, and parts of the industrial portfolio.
Operational Efficiency
Rapid expansion has led to a fragmented structure, introducing complexities that hinder optimal efficiency.

AFRY AB Class B (AFRY) vs. iShares MSCI Sweden ETF (EWD)

AFRY AB Class B Business Overview & Revenue Model

Company DescriptionAfry AB provides engineering, design, and advisory services for the infrastructure, industry, energy, and digitalization sectors in Sweden, Finland, Norway, Switzerland, Denmark, Germany, and internationally. The company operates through five divisions: Infrastructure, Industrial & Digital Solutions, Process Industries, Energy, and Management Consulting. The company offers architecture and design services; automation and manufacturing solutions; automotive and mobility services; building solutions for airports, culture and sports facilities, high security facilities, hospitals, healthcare and research, hotels and restaurants, and housing facilities; defense technology systems; digital solutions, and information and communication technology services; and engineering and consulting services for energy and power applications. It also offers environmental and sustainability solutions; services for food, life science, and pharmaceutical industries; management consulting services; solutions for processing industries, including mining and metals, food and beverage, pulp and paper, chemical, and forest industries; product development services; project management services; transport infrastructure services; and solutions for water management. The company was formerly known as ÅF Pöyry AB (publ) and changed its name to Afry AB in June 2021. Afry AB was founded in 1895 and is headquartered in Stockholm, Sweden.
How the Company Makes MoneyAFRY makes money through its comprehensive service offerings in engineering, consulting, and design across various sectors. The company's revenue model is primarily based on project-based contracts and consultancy fees. Key revenue streams include infrastructure development projects, industrial engineering services, energy solutions, and IT and digitalization services. AFRY partners with government bodies, industrial corporations, and other enterprises to deliver tailored solutions that meet sustainability and efficiency goals. Additionally, the company's strategic focus on long-term client relationships and involvement in large-scale projects significantly contributes to its earnings.

AFRY AB Class B Earnings Call Summary

Earnings Call Date:Apr 24, 2025
(Q3-2024)
|
% Change Since: -8.48%|
Next Earnings Date:Jul 15, 2025
Earnings Call Sentiment Neutral
The earnings call reflected a mixed sentiment. While there were significant achievements in profitability improvement and growth in the Energy sector, challenges in Process Industries and weak demand in IT, Telecom, and Real Estate sectors posed considerable hurdles. The market overall showed flat growth with notable segment-specific variances.
Q3-2024 Updates
Positive Updates
Improved Profitability
EBITA improved to 6.1% from 5.4% despite a mixed market, driven by strong performance in the Energy and Infrastructure divisions.
Strong Performance in the Energy Segment
The Energy division reported close to double-digit organic growth and a stable margin, with a continued strong demand across all markets.
Significant Project Wins
AFRY was selected as the main partner for SSAB's steel decarbonization project in Lulea and secured a pump storage solution project in Australia, highlighting strong capabilities in energy projects.
Stable Order Stock
Order stock remained stable at SEK 20 billion, with the Energy division continuing to report the largest increase over the previous year.
Negative Updates
Negative Growth in Process Industries
Process Industries reported a negative growth of 8.5% and a decline in order stock, attributed to a weaker market driven by the Pulp and Paper segment.
Flat Overall Growth
Total group growth was flat, with organic growth at only 0.1%, and a negative FX effect being the largest growth adjustment item.
Weak Demand in IT and Telecom
The demand for IT and telecom consultants remained weak, contributing to the mixed market performance.
Sluggish Real Estate Market
Real estate continued to operate at low levels, impacting the Infrastructure division's performance.
Company Guidance
During AFRY's Q3 2024 earnings call, the company provided detailed guidance on various performance metrics. The company reported net sales of SEK 6 billion, with an EBITDA of SEK 365 million and an EBITA margin of 6.1%, up from 5.4% the previous year. Organic growth was marginally positive at 0.1%, with the Energy division showing close to double-digit growth, while Process Industries experienced a negative growth of 8.5%. The order stock remained stable at SEK 20 billion, though 3% lower year-over-year, with notable strength in the Energy sector. AFRY emphasized maintaining strong profitability, acknowledging the mixed market conditions, with segments like Energy performing well and Process Industries facing challenges. The company highlighted ongoing strategic initiatives to capitalize on strong sectors and manage weaker ones, such as the Infrastructure improvement program and expanding in the Energy segment. Despite mixed market conditions, AFRY expressed satisfaction with its profitability improvements and outlined plans to navigate the current economic landscape.

AFRY AB Class B Financial Statement Overview

Summary
AFRY AB Class B demonstrates robust financial health, particularly in cash flow management and profitability margins. The company has a balanced capital structure and effective cost management, though there is room for improvement in revenue growth and return on equity. Managing liabilities effectively will be key for sustained stability.
Income Statement
75
Positive
AFRY AB Class B shows a solid financial performance in its income statement. The gross profit margin is healthy, with a TTM of approximately 41.5%. However, there has been a slight decline in total revenue from the previous year, indicating a need for growth focus. The net profit margin is stable at around 4.2% TTM. EBIT and EBITDA margins are robust, indicating effective cost management. The revenue growth trends show fluctuations, with some decline in recent periods, which is a point of concern.
Balance Sheet
70
Positive
The company's balance sheet reveals a moderate financial position with a debt-to-equity ratio of approximately 0.54 TTM, which is reasonable for the industry. The equity ratio stands at around 47.8%, indicating a balanced capital structure. However, the return on equity (ROE) is relatively low at 8.7% TTM, reflecting moderated profitability. The company's equity base is strong, but the high total liabilities might pose a risk if not managed effectively.
Cash Flow
82
Very Positive
AFRY AB Class B exhibits strong cash flow metrics, with a consistent free cash flow generation. The free cash flow to net income ratio is impressive at approximately 1.73 TTM, showcasing efficient cash conversion. Operating cash flow remains strong, contributing to financial flexibility. The free cash flow growth rate is positive, indicating effective capital expenditure management, despite fluctuations in investing and financing cash flows.
Breakdown
TTMDec 2024Dec 2023Dec 2022Dec 2021Dec 2020
Income StatementTotal Revenue
27.02B27.16B26.98B23.55B20.10B18.99B
Gross Profit
11.21B21.46B5.08B18.66B16.19B15.18B
EBIT
1.82B1.94B1.78B1.44B1.52B1.46B
EBITDA
2.90B2.92B2.79B2.28B2.40B2.23B
Net Income Common Stockholders
1.12B1.23B1.10B974.00M1.13B933.00M
Balance SheetCash, Cash Equivalents and Short-Term Investments
884.00M1.27B1.17B1.09B2.11B1.93B
Total Assets
26.93B28.30B28.17B28.00B25.91B23.61B
Total Debt
6.97B7.25B7.86B7.80B7.65B6.80B
Net Debt
6.09B5.99B6.69B6.71B5.54B4.87B
Total Liabilities
14.02B15.15B15.72B15.82B14.92B13.51B
Stockholders Equity
12.88B13.13B12.45B12.18B10.99B10.10B
Cash FlowFree Cash Flow
1.94B1.86B1.62B891.00M1.38B1.90B
Operating Cash Flow
2.00B1.99B1.79B1.04B1.50B2.08B
Investing Cash Flow
-311.00M-383.00M-756.00M-873.00M-1.21B-345.00M
Financing Cash Flow
-2.25B-1.47B-942.00M-1.01B-12.00M-987.00M

AFRY AB Class B Technical Analysis

Technical Analysis Sentiment
Negative
Last Price164.90
Price Trends
50DMA
172.77
Negative
100DMA
175.33
Negative
200DMA
168.38
Negative
Market Momentum
MACD
-1.57
Positive
RSI
45.04
Neutral
STOCH
22.45
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For SE:AFRY, the sentiment is Negative. The current price of 164.9 is below the 20-day moving average (MA) of 170.78, below the 50-day MA of 172.77, and below the 200-day MA of 168.38, indicating a bearish trend. The MACD of -1.57 indicates Positive momentum. The RSI at 45.04 is Neutral, neither overbought nor oversold. The STOCH value of 22.45 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for SE:AFRY.

AFRY AB Class B Peers Comparison

Overall Rating
UnderperformOutperform
Sector (66)
Financial Indicators
Name
Overall Rating
Market Cap
P/E Ratio
ROE
Dividend Yield
Revenue Growth
EPS Growth
70
Outperform
$18.80B16.838.42%3.14%0.24%10.30%
66
Neutral
$4.50B12.295.40%248.66%4.13%-12.33%
kr16.50B48.424.65%2.50%
kr24.19B11.3713.64%3.67%
kr95.56B15.4110.49%3.44%
kr59.05B27.7818.38%1.98%
kr18.29B16.90
4.19%
* Industrials Sector Average
Performance Comparison
Ticker
Company Name
Price
Change
% Change
SE:AFRY
AFRY AB Class B
164.90
-11.82
-6.69%
GB:0MWK
Lindab International AB
216.60
-12.02
-5.26%
GB:0MHT
Peab AB
81.64
13.98
20.66%
GB:0HBT
Skanska AB
232.59
54.29
30.45%
GB:0H0G
Sweco AB
165.16
20.51
14.18%
SE:BRAV
Bravida Holding AB
89.45
10.42
13.18%
Glossary
OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.
NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.
UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.

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.