Alfa Laval AB (ALFA) AI Stock Analysis

• Market Cap: kr221.05B
• Dividend Yield: 1.84%
• Average Volume (3M): 508.42K
• Price to Earnings (P/E): 26.7
• Beta (1Y): 1.09
• Revenue Growth: 3.54%
• EPS Growth: 20.94%
• Country: SE
• Employees: 22,496
• Sector: General
• Sector Strength: N/A
• Industry: Industrial - Machinery
• EPS (TTM): 4.79
• Shares Outstanding: 413,326,320
• 10 Day Avg. Volume: 527,537
• 30 Day Avg. Volume: 508,423
• PEG Ratio: 1.95
• Price to Book (P/B): 4.43
• Price to Sales (P/S): 2.76
• P/FCF Ratio: 31.26
• Enterprise Value/Market Cap: N/A
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: N/A
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: kr526.40
• Price Target Upside: -1.57% Downside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 5
• EPS Forecast (FY): 21.87
• Revenue Forecast (FY): kr71.55B

• Rating: 73 Outperform
• Price Target: kr568.00 ▲(6.21% Upside)
• Action: Reiterated Date: 02/05/26
• Date: Action: Reiterated 02/05/26

The score is driven primarily by strong financial performance (expanding margins and higher returns), supported by a favorable technical uptrend. These positives are moderated by a weaker cash-flow trend and higher leverage in 2025, and by a relatively elevated P/E with only a modest dividend yield.

Positive Factors

Margin Expansion

Alfa Laval has delivered multi-year margin expansion with EBIT and net margins moving to cycle highs. Sustained margin improvement reflects pricing power, better mix and operational execution, which supports durable profitability and cash generation across cycles and underpins reinvestment capacity.

Dual Revenue Model

The combination of new equipment sales plus after‑sales, spare parts and service contracts creates recurring revenue and higher lifetime customer value. Exposure to energy, water and food markets and sustainable solutions increases structural demand, reducing revenue volatility over the medium term.

Balance Sheet / ROE

Shareholder equity growth and a rising ROE indicate efficient capital use and stronger returns on invested capital. A solid balance sheet with improving returns supports strategic investments, service capability and resilience to shocks, enabling long‑term competitive positioning and funding flexibility.

Negative Factors

Higher Leverage

Leverage increased sharply in 2025, reducing financial flexibility and increasing interest and refinancing exposure. Higher debt levels make the company more sensitive to cyclical downturns and cash‑flow hiccups, constraining capital allocation and elevating long‑run risk if margins or revenues weaken.

Weaker Cash Flow

Although FCF still covers a meaningful portion of earnings, the year‑over‑year decline and historical volatility suggest working‑capital and investment swings. Weaker cash conversion reduces the firm's ability to self‑fund growth, service higher debt and sustain dividends during tougher cycles.

Revenue Cyclicality

End markets like marine, oil & gas and industrials are cyclical; Alfa Laval's historical revenue swings and occasional declines impair predictability. Cyclicality complicates capacity planning and capital allocation, making sustained investment and margin preservation harder across downturns.

Alfa Laval AB Business Overview & Revenue Model

Company Description

Alfa Laval Corporate AB provides heat transfer, separation, and fluid handling products and solutions worldwide. The company operates in three divisions: Energy, Food & Water, and Marine. It offers oil/gas-fired steam and composite steam boilers, exhaust gas economizer, and ballast water treatment systems, and exhaust gas cleaning products. The company also provides sensing and control, cleaning validation, condition monitoring, agitators, tank, powder mixers, fittings, and tubes, as well as wall mounted cleaning nozzles, rotary jet and heads; and tank accessories and covers. In addition, the company offers centrifugal, rotary lobe, three screw, twin screw, and circumferential piston pumps. Further, the company provides butterfly, control and check, double seal, diaphragm, double seat, regulating, safety, sampling, shutter, single seat, and ball valves. Additionally, the company offers heat exchanger, tube-in-tube heat exchangers, and process shell-and-tube heat exchangers. Furthermore, the company provides finned tube air heat, scraped surface heat exchangers, and various plate heat exchangers, wet surface, and HYAC hybrid air coolers. It also offers decanters and separator related products. The company serves energy, utilities, home, personal care, food, dairy, beverage, marine, transportation, pharmaceutical, biotech, water, and wastewater industries. Alfa Laval Corporate AB was founded in 1883 and is headquartered in Lund, Sweden.

How the Company Makes Money

Alfa Laval generates revenue through the sale of its core products, which include heat exchangers, separators, pumps, and related equipment. The company operates on a dual revenue model, earning income from both the initial sale of equipment and ongoing service contracts. Key revenue streams include new equipment sales, spare parts, and repair services, as well as maintenance agreements. Additionally, strategic partnerships with other industry leaders enhance its market reach and capabilities, contributing to its financial performance. Alfa Laval also focuses on sustainable technology solutions, which aligns with global environmental trends, potentially boosting its revenue from sectors like renewable energy and water treatment.

Alfa Laval AB Financial Statement Overview

Summary

Fundamentals are above average: multi-year revenue growth with meaningful margin expansion (EBIT and net margins near cycle highs) and improving ROE. Offsetting this, leverage increased sharply in 2025 and cash flow weakened (FCF and operating cash flow down vs 2024) with notable volatility, raising risk if conditions soften.

Income Statement

The company shows a strong multi-year earnings trajectory with revenue rising from 2022–2025 and profitability expanding meaningfully (EBIT margin improving from ~12.5% in 2022 to ~16.7% in 2025, and net margin from ~8.6% to ~11.9%). 2025 growth is modest after a strong 2022–2023 rebound, but margins remain resilient and near cycle highs, indicating good pricing/mix and execution. A key watch-out is that reported revenue growth rates appear volatile across years (including declines in 2020–2021), suggesting some cyclicality.

Balance Sheet

Balance sheet quality is solid with healthy shareholder equity and attractive returns (return on equity improving to ~19.1% in 2025 from ~12–17% in prior years). Leverage is generally moderate, but debt moved up sharply in 2025 (debt-to-equity rising to ~0.56 vs ~0.32 in 2024), which reduces flexibility versus last year and raises sensitivity to any downturn. Overall assets and equity have grown steadily, supporting the stronger earnings base.

Cash Flow

Cash generation is positive, but momentum weakened in 2025: free cash flow declined (~-7.3% growth) and operating cash flow fell versus 2024. Free cash flow still covers a meaningful portion of net income (~70% in 2025, similar to prior years), indicating decent earnings quality, but the year-to-year volatility (notably the 2022 trough and 2024 peak) points to working-capital or investment swings that can pressure near-term cash conversion.

Breakdown	Dec 2025	Dec 2024	Dec 2023	Dec 2022	Dec 2021
Income Statement
Total Revenue	69.67B	66.95B	63.60B	52.13B	40.91B
Gross Profit	25.20B	23.21B	20.88B	17.65B	14.51B
EBITDA	14.11B	12.91B	11.68B	8.89B	8.35B
Net Income	8.27B	7.39B	6.33B	4.50B	4.76B
Balance Sheet
Total Assets	98.16B	88.80B	82.29B	81.25B	64.36B
Cash, Cash Equivalents and Short-Term Investments	7.83B	7.81B	5.86B	4.66B	3.64B
Total Debt	24.34B	13.59B	16.21B	18.16B	10.80B
Total Liabilities	54.41B	46.52B	44.91B	45.55B	32.02B
Stockholders Equity	43.41B	41.91B	37.03B	35.38B	32.10B
Cash Flow
Free Cash Flow	6.16B	8.82B	6.73B	1.44B	4.04B
Operating Cash Flow	8.82B	12.16B	9.17B	3.29B	5.26B
Investing Cash Flow	-11.91B	-3.28B	-2.69B	-5.52B	-5.03B
Financing Cash Flow	3.26B	-6.74B	-5.54B	3.09B	-2.08B

Alfa Laval AB Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 534.80
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Neutral
• STOCH: Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For SE:ALFA, the sentiment is Positive. The current price of 534.8 is above the 20-day moving average (MA) of 518.69, above the 50-day MA of 500.18, and above the 200-day MA of 448.04, indicating a bullish trend. The MACD of 9.30 indicates Negative momentum. The RSI at 67.86 is Neutral, neither overbought nor oversold. The STOCH value of 82.02 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for SE:ALFA.

Alfa Laval AB Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
ATCO.B	77 Outperform	kr886.44B	31.30	26.43%	2.03%	-2.38%	-4.00%
ATCO.A	76 Outperform	kr886.44B	35.94	26.43%	1.82%	-2.38%	-4.00%
ALFA	73 Outperform	kr221.05B	26.73	20.42%	1.84%	3.54%	20.94%
SAND	70 Outperform	kr491.97B	34.10	16.39%	1.94%	-1.77%	21.13%
TREL.B	61 Neutral	kr87.58B	25.11	9.56%	1.95%	2.73%	7.56%
BEIJ.B	57 Neutral	kr70.86B	30.88	11.04%	0.95%	9.08%	-3.36%
Sector *	55 Neutral	$6.65B	3.83	-15.92%	6.20%	10.91%	7.18%

Alfa Laval AB Corporate Events

Alfa Laval Delivers Record 2025 Results, Lifts Dividend and Accelerates Growth Investments

Alfa Laval reported a record full-year 2025 despite softer order intake, with organic net sales up 8% to around SEK 70 billion, adjusted EBITA rising 11% to more than SEK 12 billion and earnings per share increasing 12% versus 2024. In the fourth quarter, orders fell 8% year-on-year, mainly due to an expected downturn in marine cargo pumping, but group net sales rose 5% and margins improved, supported by strong growth in the Energy Division driven by heat pumps, clean energy and data center demand in the US and China. The board plans to raise the dividend to SEK 9 per share, even as operating cash flow declined and the book-to-bill ratio of 0.89 kept the SEK 48 billion order book broadly stable. Management highlighted 2025 as a year of strategic preparation, rolling out a new operating model, reorganizing business units and regional sales, and committing to major investment programs, including an expansion in Bergen, Norway for cargo pumping and a SEK 1 billion capacity build-out to capture booming data center demand, with some one-off integration and restructuring costs expected to persist into the first half of 2026 and a near-term outlook of flat demand in the first quarter of 2026 versus the preceding quarter.

The most recent analyst rating on (SE:ALFA) stock is a Hold with a SEK575.00 price target. To see the full list of analyst forecasts on Alfa Laval AB stock, see the SE:ALFA Stock Forecast page.