Epiroc AB (EPI.A) AI Stock Analysis

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SE:EPI.A Dividends

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Epiroc AB

(EPI.A)

80Outperform

Epiroc AB's overall stock score of 80 reflects its strong financial performance, particularly in revenue and cash flow growth, supported by a robust balance sheet. The positive sentiment from the latest earnings call, highlighting record orders and strategic growth in automation and electrification, further enhances its outlook. However, valuation concerns due to a high P/E ratio and challenges in the construction market slightly temper the score. The technical analysis suggests some caution due to potential overbought conditions and negative short-term momentum.

Epiroc AB (EPI.A) vs. S&P 500 (SPY)

Market Cap

kr249.82B

Dividend Yield1.78%

Average Volume (3M)1.03M

Price to Earnings (P/E)28.8

Beta (1Y)1.19

Revenue Growth7.22%

EPS Growth-2.59%

CountrySE

Employees19,042

SectorIndustrials

Sector Strength80

IndustryAgricultural - Machinery

Share Statistics

EPS (TTM)1.82

Shares Outstanding823,765,800

10 Day Avg. Volume968,510

30 Day Avg. Volume1,027,606

Financial Highlights & Ratios

PEG RatioN/A

Price to Book (P/B)N/A

Price to Sales (P/S)0.00

Price to Cash Flow (P/CF)0.00

P/FCF Ratio0.00

Enterprise Value/Market CapN/A

Enterprise Value/RevenueN/A

Enterprise Value/Gross ProfitN/A

Enterprise Value/EbitdaN/A

Forecast

1Y Price Target

kr204.22

Price Target Upside-4.66% Downside

Rating ConsensusHold

Number of Analyst Covering9

Epiroc AB Business Overview & Revenue Model

Company DescriptionEpiroc AB is a leading productivity partner for the mining, infrastructure, and natural resources industries. The company develops and produces innovative equipment, consumables, and service solutions that are used in surface and underground mining, infrastructure, civil works, well drilling, and geotechnical applications. Headquartered in Stockholm, Sweden, Epiroc operates in multiple countries and is known for its robust portfolio of products and services that enhance operational efficiency and safety.

How the Company Makes MoneyEpiroc AB generates revenue primarily through the sale of equipment and aftermarket services. Its key revenue streams include the production and sale of drilling rigs, rock excavation equipment, construction tools, and related consumables. The company also offers comprehensive service solutions, including maintenance, repairs, and parts, which provide a steady stream of income beyond initial equipment sales. Epiroc's business model is further supported by strategic partnerships with mining and infrastructure companies, enabling it to offer tailored solutions and foster long-term customer relationships. Additionally, Epiroc enhances its earnings through technological innovations and digital solutions that optimize operational efficiency for its clients.

Epiroc AB Financial Statement Overview

Summary

Epiroc AB's financial statements reveal a highly stable and profitable company with strong growth trajectories in revenue and free cash flow. The debt-free balance sheet enhances its financial flexibility and reduces risk, while strong margins and cash flows indicate operational efficiency. The company is well-positioned for continued growth and value creation in the competitive agricultural machinery industry.

Income Statement

Very Positive

Epiroc AB has demonstrated strong financial performance, with consistent revenue growth over the years, including a notable increase from SEK 60.34 billion in 2023 to SEK 63.60 billion in 2024. The company maintains high profitability with a steady gross profit margin, and although there was a slight decline in EBIT and net profit margins in 2024 compared to 2023, they remain robust. These factors indicate a well-managed income statement with effective cost control and solid revenue generation capabilities.

Balance Sheet

Very Positive

The balance sheet of Epiroc AB is exceptionally strong, characterized by a debt-free position in 2024, enhancing financial stability. The company has grown its equity base, reflecting strong financial health, and maintains a high equity ratio. The return on equity remains impressive, indicating efficient use of shareholder funds. The balance sheet reflects a solid foundation for future growth with a prudent capital structure.

Cash Flow

Very Positive

Epiroc AB exhibits a robust cash flow position, with significant growth in free cash flow from SEK 5.46 billion in 2023 to SEK 8.60 billion in 2024, driven by strong operating cash flows. The company effectively balances its capital expenditures, ensuring sustainable free cash flow generation. These factors highlight strong cash flow management, providing ample liquidity for reinvestment and shareholder returns.

Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Breakdown
Income Statement		Total Revenue
63.60B	60.34B	49.69B	39.65B	36.12B
	Gross Profit
22.95B	23.15B	19.02B	15.45B	13.70B
	EBIT
12.38B	13.18B	11.15B	8.99B	7.38B
	EBITDA
15.47B	15.69B	13.25B	10.92B	9.08B
	Net Income Common Stockholders
8.73B	9.43B	8.40B	7.06B	5.40B
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
7.18B	6.40B	7.33B	10.79B	15.05B
	Total Assets
83.59B	67.78B	61.78B	48.58B	43.89B
	Total Debt
0.00	13.97B	10.74B	9.18B	10.06B
	Net Debt
14.39B	7.57B	3.42B	-1.61B	-5.00B
	Total Liabilities
40.41B	30.57B	28.27B	22.80B	20.15B
	Stockholders Equity
42.76B	36.82B	33.02B	25.73B	23.69B
Cash Flow		Free Cash Flow
8.60B	5.46B	4.54B	6.68B	7.33B
	Operating Cash Flow
10.46B	7.14B	5.56B	7.61B	8.33B
	Investing Cash Flow
-11.69B	-5.24B	-5.99B	-3.47B	-608.00M
	Financing Cash Flow
1.90B	-2.64B	-3.23B	-8.44B	-990.00M

Epiroc AB Technical Analysis

Technical Analysis Sentiment

Positive

Last Price214.20

Price Trends

50DMA

204.12

Positive

100DMA

204.37

Positive

200DMA

202.46

Positive

Market Momentum

MACD

4.02

Negative

RSI

64.68

Neutral

STOCH

89.67

Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For SE:EPI.A, the sentiment is Positive. The current price of 214.2 is above the 20-day moving average (MA) of 198.70, above the 50-day MA of 204.12, and above the 200-day MA of 202.46, indicating a bullish trend. The MACD of 4.02 indicates Negative momentum. The RSI at 64.68 is Neutral, neither overbought nor oversold. The STOCH value of 89.67 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for SE:EPI.A.

Epiroc AB Peers Comparison

Overall Rating

UnderperformOutperform

Sector (64)

Financial Indicators

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
EPI.A	80 Outperform	kr249.82B	28.83		1.78%	7.22%	-2.59%
ATCO.B	78 Outperform	kr701.17B	22.57	27.15%	2.21%	0.54%	1.79%
VOLV.A	74 Outperform	kr527.67B	11.66	25.90%	3.10%	-6.35%	-9.41%
VOLV.B	74 Outperform	kr527.67B	11.65	25.90%	3.08%	-6.35%	-9.41%
ATCO.A	72 Outperform	kr701.17B	25.31	27.15%	1.94%	0.54%	1.79%
SAND	70 Neutral	kr252.13B	17.28	15.81%	2.83%	-1.09%	15.72%
Sector *	64 Neutral	$4.24B	11.66	5.23%	249.83%	4.08%	-10.45%

* Industrials Sector Average

Performance Comparison

SE:EPI.A

Epiroc AB

214.90

4.18

1.98%

SE:VOLV.A

Volvo AB

263.40

-5.48

-2.04%

SE:ATCO.A

Atlas Copco AB

152.10

-44.10

-22.48%

SE:SAND

Sandvik AB

205.00

-21.28

-9.41%

SE:VOLV.B

Volvo AB

262.80

3.34

1.29%

SE:ATCO.B

Atlas Copco AB

133.75

-36.32

-21.35%

Epiroc AB Earnings Call Summary

Earnings Call Date:Apr 29, 2025

(Q4-2024)

% Change Since: 6.04%|

Next Earnings Date:Jul 18, 2025

Earnings Call Sentiment Neutral

Epiroc demonstrated strong growth and operational efficiency in key strategic areas like mining, automation, and electrification, achieving record orders and revenue. However, challenges in construction demand and margin pressures from acquisitions and market weaknesses presented notable obstacles. The overall sentiment is slightly positive but tempered by these challenges.

Q4-2024 Updates

Positive Updates

Record High Orders and Revenue

Epiroc achieved record highs for orders received and revenues in 2024, supported by acquisitions and strong mining development. Orders in Q4 increased 12% to SEK 16.2 billion, with organic growth of 5%.

Growth in Strategic Areas

Epiroc increased its number of driverless machines by 21% in 2024. Orders for Digital Solutions increased by more than 30%, with strong demand for automation and digitalization solutions.

Electrification Progress

The electrification revenues of group total were 4.2% with significant orders for battery electric equipment. 39 mining sites globally have ordered BEV equipment since 2018, with 28% reordering.

Operational Efficiency Improvements

Sequential inventory reduction by SEK 1 billion with lead times back to normal levels. Workforce reduced by 1,135 employees in 2024 as part of efficiency measures.

Strong Cash Flow

Record high operating cash flow of nearly SEK 4 billion in Q4, representing a 104% cash conversion rate.

Negative Updates

Decrease in Operating Profit Margin

The operating profit margin decreased due to weaker construction demand and dilution from acquisitions. Adjusted EBIT margin was 19.8%, down from the previous year.

Weak Construction Market

Demand for attachments used in construction was weak, impacting overall orders and revenue mix negatively.

Tools & Attachment Segment Challenges

Mixed demand with 1% negative organic revenue development and dilution from acquisitions affecting the margin. Seasonality and one-time costs impacted performance.

Company Guidance

In the Epiroc Q4 and Full Year Results Presentation for 2024, the company reported record highs in orders received and revenues, driven by strong demand in mining equipment and services, despite a weaker construction market. The adjusted operating margin (EBIT) was 19.8%, with a noted decrease due to dilution effects and higher construction activity following the Stanley Infrastructure acquisition. Automation initiatives saw a 21% increase in driverless machines, with over 3,450 automated mixed fleet machines deployed. Digital Solutions orders grew by over 30%, while electrification revenues reached 4.2%. The company's efficiency actions included a workforce reduction of around 1,135 employees in 2024 and a SEK 1 billion inventory reduction. The Tools & Attachment segment experienced a 39% order growth, mainly due to the Stanley acquisition, despite a negative 1% organic revenue change. Epiroc's net debt-to-EBITDA ratio was 0.93%, and the Board proposed a dividend of SEK 3.80 per share. The company expects strong mining demand to continue, while construction demand remains weak.

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.