Atlas Copco AB (ATCO.B) AI Stock Analysis

• Market Cap: kr850.76B
• Dividend Yield: 2.03%
• Average Volume (3M): 1.31M
• Price to Earnings (P/E): 29.4
• Beta (1Y): 1.36
• Revenue Growth: -2.38%
• EPS Growth: -4.00%
• Country: SE
• Employees: 55,248
• Sector: General
• Sector Strength: N/A
• Industry: Industrial - Machinery
• EPS (TTM): 1.36
• Shares Outstanding: 1,560,876,000
• 10 Day Avg. Volume: 1,400,676
• 30 Day Avg. Volume: 1,312,628
• PEG Ratio: -2.47
• Price to Book (P/B): 6.58
• Price to Sales (P/S): 4.31
• P/FCF Ratio: 25.65
• 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: N/A
• Price Target Upside: N/A
• Rating Consensus: N/A
• Number of Analyst Covering: 0
• EPS Forecast (FY): N/A
• Revenue Forecast (FY): N/A

• Rating: 77 Outperform
• Price Target: kr181.00 ▲(18.53% Upside)

The score is driven primarily by strong financial fundamentals (durable margins, solid profitability, and conservative leverage), supported by constructive technical trends. The main offset is valuation, with a relatively high P/E despite a modest dividend yield, alongside a near-term 2025 growth and free-cash-flow slowdown.

Positive Factors

Durable high margins

Sustained gross and operating margins at industrial-machinery levels indicate strong pricing power, differentiated products and service mix. High margins support resilient profitability through cycles, enabling reinvestment, R&D and steady cash returns over the medium term.

Conservative leverage with strong ROE

Low leverage and high ROE reflect disciplined capital structure and efficient capital allocation. Conservative debt profiles preserve financial flexibility for capex, acquisitions or downturns, while elevated ROE shows the business converts invested capital into attractive long-term returns.

Diversified, recurring revenue streams

A mix of new equipment sales, aftermarket service agreements and rental offerings creates recurring revenue and higher lifetime customer value. This diversification reduces dependence on one market, stabilizes cash flows, and strengthens customer retention over multiple cycles.

Negative Factors

Near-term growth slowdown

A tangible revenue and profit pullback in 2025 signals cyclical sensitivity and potential demand softening in end markets. If sustained, slower top-line growth can compress reinvestment capacity, slow margin expansion initiatives, and pressure medium-term earnings trajectory.

Weakening free cash flow trend

A decline in FCF growth and variable cash conversion indicate operational volatility and less predictable funding for dividends, buybacks or acquisitions. Persistent FCF erosion would constrain strategic flexibility and heighten reliance on external financing in stress periods.

Earnings per share contraction

Material EPS decline highlights margin or volume pressures and reduces retained earnings for organic investment. Continued EPS contraction undermines shareholder returns, may limit strategic initiatives, and signals vulnerability if end-market recovery lags or competition intensifies.

Atlas Copco AB Business Overview & Revenue Model

Company Description

Atlas Copco AB, together with its subsidiaries, provides productivity solutions. The company operates through Compressor Technique, Vacuum Technique, Industrial Technique, and Power Technique segments. It offers piston compressors, oil-free tooth and scroll compressors, rotary screw compressors, oil-free blowers, oil-free centrifugal compressors, gas and process compressors, air and gas treatment equipment, and medical air solutions primarily for use in the manufacturing and process industries. The company also provides oil-sealed rotary vane, dry, and liquid ring vacuum pumps; and turbomolecular and cryogenic pumps, as well as abatement and integrated systems for the semiconductor and scientific, chemical process, food packaging, and paper handling industries. In addition, it offers pneumatic, hydraulic, and electric assembly tools, as well as control systems and associated software for safety-critical tightening; self-pierce riveting tools, dispensing equipment for adhesives and sealants, and flow drill fastening equipment; material removal tools, drills, and other pneumatic products; and machine vision solutions for customers in the automotive and general industries. Further, the company provides portable compressors, boosters, generators, lighting towers, pumps, and construction and demolition tools for civil engineering, oil and gas, construction, manufacturing, exploration drilling, and demolition industries, as well as specialty rental services. It operates in North America, South America, Europe, Africa, the Middle East, Asia, and Oceania. The company was founded in 1873 and is headquartered in Nacka, Sweden.

How the Company Makes Money

Atlas Copco generates revenue through multiple key channels, primarily by selling equipment and machinery in its core sectors. The company’s revenue model is structured around three main streams: product sales, service agreements, and rental services. Product sales account for a significant portion of earnings, where the company sells new equipment to various industries, including manufacturing, automotive, and construction. Service agreements, which include maintenance and aftermarket services, provide a steady stream of recurring revenue, enhancing customer loyalty and ensuring long-term relationships. Additionally, Atlas Copco offers rental services for its equipment, allowing customers to access high-quality machinery without upfront capital investment. The company also engages in strategic partnerships and acquisitions to broaden its product offerings and expand into new markets, further contributing to its revenue growth.

Atlas Copco AB Financial Statement Overview

Summary

Strong, consistent profitability (gross margin ~42–44%, EBIT margin ~19–22%, net margin mid-teens) and conservative leverage (debt-to-equity ~0.31–0.46) support a high-quality financial profile. The score is tempered by the 2025 slowdown (revenue and profit decline) and softer recent free-cash-flow trend (FCF growth -6.133%).

Income Statement

Profitability is consistently strong with gross margin holding around ~42–44% and net margin in the mid-teens, alongside solid operating profitability (EBIT margin ~19–22%) across the period. Revenue expanded strongly from 2021–2024, but 2025 revenue declined (-1.869%) and profits stepped down versus 2024, signaling a near-term growth pause despite still-healthy margins.

Balance Sheet

Leverage looks conservative for the sector with debt-to-equity generally ~0.31–0.46 and improving versus earlier years, supporting financial flexibility. Returns on equity are high (~24–31%), indicating effective capital use, though the slight downshift in 2025 versus prior peak levels suggests returns may be normalizing.

Cash Flow

Cash generation is strong: free cash flow is substantial and consistently covers most of net income (roughly ~0.76–0.87), indicating good earnings quality. However, cash flow conversion is not consistently high (operating cash flow coverage ~0.35–0.71) and free cash flow growth turned negative in 2025 (-6.133%), pointing to some volatility and a softer recent cash-flow trend.

Breakdown	Dec 2025	Dec 2024	Dec 2023	Dec 2022	Dec 2021
Income Statement
Total Revenue	168.34B	176.77B	172.66B	141.32B	110.91B
Gross Profit	72.21B	75.74B	75.12B	59.38B	46.53B
EBITDA	43.64B	47.50B	45.12B	36.07B	28.61B
Net Income	26.42B	29.78B	28.04B	23.48B	18.13B
Balance Sheet
Total Assets	202.45B	208.54B	188.21B	172.30B	136.68B
Cash, Cash Equivalents and Short-Term Investments	16.13B	19.33B	11.22B	11.85B	19.58B
Total Debt	34.90B	34.71B	32.71B	36.30B	24.85B
Total Liabilities	92.07B	94.78B	96.70B	92.28B	69.05B
Stockholders Equity	110.21B	113.70B	91.45B	79.98B	67.63B
Cash Flow
Free Cash Flow	28.28B	30.86B	22.63B	16.35B	19.79B
Operating Cash Flow	32.57B	36.89B	28.08B	21.38B	23.15B
Investing Cash Flow	-17.62B	-13.32B	-9.39B	-15.50B	-6.12B
Financing Cash Flow	-16.37B	-15.86B	-18.28B	-14.65B	-10.32B

Atlas Copco AB Technical Analysis

• Technical Analysis Sentiment: Neutral
• Last Price: 152.70
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Positive
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For SE:ATCO.B, the sentiment is Neutral. The current price of 152.7 is below the 20-day moving average (MA) of 160.34, above the 50-day MA of 151.01, and above the 200-day MA of 140.28, indicating a neutral trend. The MACD of 3.58 indicates Positive momentum. The RSI at 53.11 is Neutral, neither overbought nor oversold. The STOCH value of 29.06 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for SE:ATCO.B.

Atlas Copco AB Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
ATCO.B	77 Outperform	kr850.76B	29.40	26.43%	2.03%	-2.38%	-4.00%
TREL.B	73 Outperform	kr86.61B	24.36	9.56%	1.95%	2.73%	7.56%
ALFA	71 Outperform	kr209.56B	25.12	20.42%	1.84%	3.54%	20.94%
SAND	70 Outperform	kr434.52B	29.58	16.39%	1.94%	-1.77%	21.13%
MYCR	64 Neutral	kr40.88B	23.38	26.95%	1.71%	14.48%	0.52%
BEIJ.B	57 Neutral	kr68.40B	27.90	11.04%	0.95%	9.08%	-3.36%
Sector *	55 Neutral	$6.65B	3.83	-15.92%	6.20%	10.91%	7.18%