Essity Aktiebolag (ESSITY.A) AI Stock Analysis

• Market Cap: kr188.95B
• Dividend Yield: 3.03%
• Average Volume (3M): 6.78K
• Price to Earnings (P/E): 15.1
• Beta (1Y): 0.16
• Revenue Growth: -8.34%
• EPS Growth: -31.13%
• Country: SE
• Employees: 36,000
• Sector: Consumer Defensive
• Sector Strength: 62
• Industry: Household & Personal Products
• EPS (TTM): 4.43
• Shares Outstanding: 58,973,656
• 10 Day Avg. Volume: 9,697
• 30 Day Avg. Volume: 6,784
• PEG Ratio: -0.39
• Price to Book (P/B): 2.43
• Price to Sales (P/S): 0.00
• P/FCF Ratio: 21.73
• 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

• Rating: 71 Outperform
• Price Target: kr308.00 ▲(12.41%Upside)

Essity Aktiebolag's overall stock score of 71.05 reflects a solid financial performance and reasonable valuation, but mixed technical indicators and challenges highlighted in the earnings call. The company's strategic deleveraging and strong cash flow management are key strengths, while ongoing efforts to improve operational efficiency and manage costs will be crucial for future performance.

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 makes money through the sale of its diverse range of hygiene and health products across its three main business areas: Personal Care, Consumer Tissue, and Professional Hygiene. Revenue is generated from both retail sales to individual consumers and bulk sales to businesses and institutions. In Personal Care, Essity earns through products like incontinence care, baby care, and feminine care, often collaborating with healthcare providers and leveraging strong brand names like TENA and Libero. In Consumer Tissue, revenue comes from the sale of toilet paper, facial tissues, and paper towels, with well-known brands such as Lotus and Tempo. Professional Hygiene focuses on supplying businesses and institutions with hygiene solutions under brands like Tork. The company also engages in strategic partnerships and acquisitions to enhance its market presence and leverage synergies across its operations. Essity's earnings are significantly influenced by its global distribution network, brand strength, and ongoing innovation in product development.

Essity Aktiebolag Financial Statement Overview

Summary

Essity Aktiebolag presents a solid financial profile with strong operational margins and effective cash flow management. The company's strategic focus on deleveraging has improved its financial stability, although revenue growth remains flat. Continued emphasis on enhancing return on equity and maintaining cash efficiency will be crucial for sustained financial performance.

Income Statement

Essity Aktiebolag has demonstrated consistent revenue generation with a stable gross profit margin of approximately 32% over the TTM period. The net profit margin for the TTM stands at 8.63%, which is a notable recovery from the previous year's performance. Although revenue growth has been flat, the company has maintained strong EBIT and EBITDA margins, indicating efficient cost management and operational stability.

Balance Sheet

The balance sheet reflects a strong equity position with an equity ratio of 46.3% in the TTM period. The elimination of total debt in the TTM indicates a significant deleveraging effort, enhancing financial stability. However, the lower return on equity (ROE) of 15.85% suggests room for improvement in generating returns from shareholder investments.

Cash Flow

Essity's cash flow performance is robust, with a favorable operating cash flow to net income ratio of 1.28 in the TTM. The free cash flow to net income ratio is 0.71, indicating efficient cash conversion. Although there was a decline in free cash flow compared to the previous year, the overall cash flow management remains strong.

Breakdown
TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement		Total Revenue
145.67B	145.55B	147.15B	156.17B	121.87B	121.75B
	Gross Profit
47.14B	47.13B	45.13B	37.23B	35.09B	39.44B
	EBIT
18.59B	18.30B	17.75B	9.48B	13.20B	16.76B
	EBITDA
26.20B	26.14B	20.90B	15.44B	20.45B	24.89B
	Net Income Common Stockholders
12.57B	20.89B	9.55B	5.57B	8.62B	10.23B
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
12.66B	15.62B	5.19B	4.50B	4.09B	5.15B
	Total Assets
171.24B	185.28B	202.99B	210.60B	175.05B	154.65B
	Total Debt
0.00	43.78B	60.98B	66.58B	56.83B	45.88B
	Net Debt
-9.77B	32.81B	55.83B	62.29B	52.93B	40.90B
	Total Liabilities
91.54B	96.54B	123.59B	134.04B	106.54B	91.30B
	Stockholders Equity
79.29B	88.31B	70.85B	67.35B	59.87B	54.35B
Cash Flow		Free Cash Flow
8.88B	9.40B	14.68B	5.92B	7.31B	11.21B
	Operating Cash Flow
16.04B	16.80B	21.57B	12.87B	14.67B	17.82B
	Investing Cash Flow
-4.87B	9.41B	-7.11B	-14.50B	-12.13B	-7.09B
	Financing Cash Flow
-12.55B	-22.34B	-11.55B	1.81B	-3.81B	-8.38B

Essity Aktiebolag Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 274.00
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Positive
• RSI: Neutral
• STOCH: Positive

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For SE:ESSITY.A, the sentiment is Negative. The current price of 274 is below the 20-day moving average (MA) of 277.65, below the 50-day MA of 278.39, and below the 200-day MA of 288.32, indicating a bearish trend. The MACD of -1.17 indicates Positive momentum. The RSI at 41.46 is Neutral, neither overbought nor oversold. The STOCH value of 4.52 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for SE:ESSITY.A.

Essity Aktiebolag Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
ACAD	78 Outperform	€8.23B	11.17	11.91%	2.01%	13.81%	31.44%
CLA.B	77 Outperform	$9.85B	15.63	11.12%	2.78%	1.61%	30.09%
AMBEA	72 Outperform	€8.89B	15.17	12.49%	1.89%	5.86%	33.17%
ESSITY.A	71 Outperform	kr188.95B	15.09		3.03%	-8.34%	-31.13%
DUNI	71 Outperform	kr4.64B	19.19	6.76%	4.86%	1.68%	-38.11%
Sector *	65 Neutral	$8.88B	15.03	4.75%	203.74%	3.58%	-2.49%
MSON.B	62 Neutral	kr1.29B	33.98	1.23%	2.26%	-0.35%	―