Essity Aktiebolag (ESSITY.A) AI Stock Analysis

• Market Cap: kr177.49B
• Dividend Yield: 3.22%
• Average Volume (3M): 10.70K
• Price to Earnings (P/E): 14.5
• Beta (1Y): 0.17
• Revenue Growth: -5.52%
• EPS Growth: -35.37%
• Country: SE
• Employees: 36,000
• Sector: Consumer Goods
• Sector Strength: N/A
• Industry: Household & Personal Products
• EPS (TTM): 4.39
• Shares Outstanding: 58,473,656
• 10 Day Avg. Volume: 8,002
• 30 Day Avg. Volume: 10,699
• PEG Ratio: N/A
• Price to Book (P/B): N/A
• Price to Sales (P/S): N/A
• P/FCF Ratio: N/A
• 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: kr230.00
• Price Target Upside: -10.33% Downside
• Rating Consensus: Moderate Sell
• Number of Analyst Covering: 1

• Rating: 74 Outperform
• Price Target: kr286.00 ▲(11.50% Upside)

Essity Aktiebolag's overall stock score reflects a balanced view of its financial stability, attractive valuation, and positive technical indicators. The company's strong balance sheet and reasonable P/E ratio are significant strengths. However, challenges in revenue growth and cash flow efficiency, along with mixed long-term technical signals, moderate the overall score.

Essity Aktiebolag Business Overview & Revenue Model

Company Description

Essity AB (publ) develops, produces, and sells hygiene and health products and services worldwide. It offers health and medical products, including incontinence products, wound care, compression therapy, orthopedics, skincare products, and digital solutions with sensor technology. It operates in Personal Care, Consumer Tissue, Professional Hygiene, and Other segments. The company also provides consumer goods, such as incontinence products, pads, diapers, wet wipes, skincare products, intimate soaps, washable absorbent underwear, menstrual cups, toilet papers, household towels, handkerchiefs, facial tissues, and napkins; and professional hygiene products that consist of toilet papers, paper hand towels, napkins, hand soaps, hand lotions, hand sanitizers, dispensers, and cleaning and wiping products. In addition, it offers digital solutions, such as Internet of Things sensor technology enabling data-driven cleaning, as well as related service and maintenance to companies and office buildings, universities, healthcare facilities, industries, restaurants, hotels, stadiums, and other public venues. The company markets its health and medical products under the TENA, Leukoplast, Cutimed, JOBST, Actimove, and Delta-Castbrands brands through pharmacies, medical devices stores, hospitals, distributors, and care institutions, as well as e-commerce; consumer goods products under the Libero, Libresse, Nosotras, Saba, TOM Organic, Lotus, Regio, Tempo, and Vinda brands through retail trade and online; and professional hygiene products under the TORK brand through distributors and online. It serves in Europe, North America, Latin America, Asia, and internationally. Essity AB (publ) was founded in 1849 and is headquartered in Stockholm, Sweden.

How the Company Makes Money

Essity generates revenue through the sale of its diverse range of hygiene and health products across multiple channels, including retail, e-commerce, and direct sales to businesses. The company's revenue model is primarily based on product sales, with key revenue streams coming from its Consumer segment (which includes personal care and tissue products) and Professional segment (which includes medical and hygiene products for healthcare facilities). Essity's strong brand portfolio, which includes well-known names like TENA, Libero, and Tempo, supports its market presence and pricing power. Additionally, strategic partnerships with retailers and distributors enhance its distribution capabilities, while a focus on sustainability and innovation attracts environmentally conscious consumers, further contributing to its earnings.

Essity Aktiebolag Financial Statement Overview

Summary

Essity Aktiebolag demonstrates a solid financial foundation with stable margins and effective debt management. However, the company faces challenges in revenue growth and cash flow efficiency. Strategic initiatives to enhance sales and optimize cash flow could bolster financial performance. The balance sheet remains strong, supporting future growth opportunities.

Income Statement

Essity Aktiebolag's income statement shows a mixed performance. The company has maintained a healthy gross profit margin of around 32-33% over the years, indicating efficient cost management. However, the net profit margin has seen a decline in the TTM period to 8.58% from 14.35% in 2024, reflecting potential challenges in maintaining profitability. Revenue growth has been negative in recent periods, with a TTM decline of 1.67%, suggesting a need for strategic initiatives to boost sales. Despite these challenges, the EBIT and EBITDA margins remain stable, showcasing operational efficiency.

Balance Sheet

The balance sheet reflects a stable financial position with a debt-to-equity ratio improving to 0.51 in the TTM period from 0.86 in 2023, indicating effective debt management. The return on equity (ROE) is strong at 14.82% in the TTM period, although it has decreased from 23.65% in 2024, suggesting a decline in profitability relative to shareholder equity. The equity ratio is not explicitly mentioned, but the overall leverage appears manageable, with a focus on maintaining equity levels.

Cash Flow

Cash flow analysis shows a decline in free cash flow growth by 10.86% in the TTM period, indicating potential cash management challenges. The operating cash flow to net income ratio is at 0.40, suggesting that the company generates sufficient cash from operations relative to its net income. However, the free cash flow to net income ratio has decreased to 0.53 from 0.56 in 2024, highlighting a need for improved cash flow efficiency.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	143.24B	145.55B	147.15B	156.17B	121.87B	121.75B
Gross Profit	46.78B	47.13B	45.13B	37.23B	35.09B	39.44B
EBITDA	25.69B	26.14B	20.90B	15.44B	20.45B	24.89B
Net Income	12.29B	20.89B	9.55B	5.57B	8.62B	10.23B
Balance Sheet
Total Assets	167.41B	185.28B	202.99B	210.60B	175.05B	154.65B
Cash, Cash Equivalents and Short-Term Investments	6.70B	15.62B	5.19B	4.50B	4.09B	5.15B
Total Debt	41.34B	43.78B	60.98B	66.58B	56.83B	45.88B
Total Liabilities	86.21B	96.54B	123.59B	134.04B	106.54B	91.30B
Stockholders Equity	80.80B	88.31B	70.85B	67.35B	59.87B	54.35B
Cash Flow
Free Cash Flow	7.91B	9.40B	14.68B	5.92B	7.31B	11.21B
Operating Cash Flow	15.04B	16.80B	21.57B	12.87B	14.67B	17.82B
Investing Cash Flow	-5.26B	9.41B	-7.11B	-14.50B	-12.13B	-7.09B
Financing Cash Flow	-16.10B	-22.34B	-11.55B	1.81B	-3.81B	-8.38B

Essity Aktiebolag Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 256.50
• 50DMA: Positive
• 100DMA: Negative
• 200DMA: Negative
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For SE:ESSITY.A, the sentiment is Positive. The current price of 256.5 is above the 20-day moving average (MA) of 252.40, above the 50-day MA of 252.73, and below the 200-day MA of 274.20, indicating a neutral trend. The MACD of 1.37 indicates Negative momentum. The RSI at 58.69 is Neutral, neither overbought nor oversold. The STOCH value of 43.29 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for SE:ESSITY.A.

Essity Aktiebolag Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
ESSITY.A	74 Outperform	kr177.49B	14.50		3.22%	-5.52%	-35.37%
Sector *	57 Neutral	$3.12B	8.17	-34.32%	3.15%	-25.56%	-353.61%
ETTYF	―	$18.89B	16.01	14.51%	2.70%	―	―
2DU	―	€389.63M	19.61	6.56%	―	―	―