Svenska Cellulosa Aktiebolaget Class A (SCA.A) AI Stock Analysis

• Market Cap: kr86.28B
• Dividend Yield: 2.49%
• Average Volume (3M): 8.24K
• Price to Earnings (P/E): 26.9
• Beta (1Y): 0.67
• Revenue Growth: 6.10%
• EPS Growth: -3.62%
• Country: SE
• Employees: 3,333
• Sector: Basic Materials
• Sector Strength: 58
• Industry: Paper, Lumber & Forest Products
• EPS (TTM): 0.69
• Shares Outstanding: 60,866,430
• 10 Day Avg. Volume: 8,989
• 30 Day Avg. Volume: 8,245
• PEG Ratio: -2.24
• Price to Book (P/B): 0.85
• Price to Sales (P/S): 4.22
• P/FCF Ratio: 71.64
• 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: kr125.00
• Price Target Upside: 1.30% Upside
• Rating Consensus: Hold
• Number of Analyst Covering: 1
• EPS Forecast (FY): 4.86
• Revenue Forecast (FY): kr20.77B

• Rating: 57 Neutral
• Price Target: kr127.00 ▲(2.92% Upside)
• Action: Reiterated Date: 02/01/26
• Date: Action: Reiterated 02/01/26

The score is primarily supported by a conservatively levered balance sheet and generally positive operating cash flow, but is held back by weakening profitability/cash conversion and a clearly bearish technical setup (below key moving averages with negative MACD). Valuation is mixed, with a relatively high P/E partly offset by a moderate dividend yield.

Positive Factors

Conservative balance sheet

Low leverage and a large equity base provide structural resilience in a cyclical forest-products industry. This conservative capital structure supports the company's ability to fund capital cycles, absorb commodity shocks, and maintain strategic flexibility across multi-year harvest and investment horizons.

Steady operating cash generation

Consistent operating cash flows supply recurring liquidity to fund forestry cycles, mill maintenance, and bioenergy operations. Over the medium term this underpins reinvestment capacity and supports dividend and capex programs even as commodity prices cycle.

Vertically integrated forest-to-products model

Owning and managing forest assets combined with downstream processing secures raw material supply, captures more value across the chain, and benefits from structural demand in packaging, construction and renewable energy, supporting durable cash generation.

Negative Factors

Weakened profitability / ROE decline

A sustained drop in return on equity halved historical profitability, indicating lower earnings power relative to the large capital base. Over the medium term this compresses shareholder returns and raises the bar for management to improve operational efficiency or redeploy capital.

Volatile and declining free cash flow

Marked FCF volatility and a sharp 2025 decline reduce predictable cash available for dividends, debt reduction or strategic investments. Weak cash conversion relative to earnings limits financial flexibility and heightens sensitivity to capex and working-capital swings.

Revenue weakness and margin-quality issues

A decline in revenue and a negative reported gross profit in 2025 point to cost pressure or accounting/reclassification issues that impair margin visibility. This undermines confidence in sustainable operating margins and complicates forecasting over the next several quarters.

Svenska Cellulosa Aktiebolaget Class A Business Overview & Revenue Model

Company Description

Svenska Cellulosa Aktiebolaget SCA (publ), a forest products company, develops, produces, and sells forest, wood, pulp, and containerboard products. The company offers various wood products, industrial components, standard wood products, and raw materials, as well as logistic, warehouse, and IT solutions for the wood industry. It also provides pulp products under the Pure, Star, and Cirrus names; and Kraftliner products for consumer durables, electronics, hazardous goods, industrial products, fruit and vegetables, frozen foods, etc. In addition, the company offers forwarding services for various transport modes, such as truck, rail, and barge, as well as marine and road and rail transport; terminal services; and liquid and solid biofuels, pellets, stall pellets, and wind energy. Further, it engages in the processing and distribution of wood products; production of Kraft and chemical thermomechanical pulps, and containerboards; and generation of energy from wind power projects, biomass, and by-products. The company has operation in Sweden, the United States, the United Kingdom, Germany, rest of Europe, Asia, and internationally. Svenska Cellulosa Aktiebolaget SCA (publ) was founded in 1929 and is headquartered in Sundsvall, Sweden.

How the Company Makes Money

SCA.A generates revenue through multiple key streams, primarily from the sale of wood products, pulp, and paper. The company benefits from its extensive ownership of forest land, which provides a steady supply of raw materials for its production processes. A significant portion of its revenue comes from the production and sale of hygiene products, which are marketed under well-known brands. SCA also engages in partnerships with retailers and distributors to expand its market reach, leveraging its strong brand recognition in the hygiene segment. Additionally, the company's commitment to sustainability and eco-friendly practices attracts environmentally conscious consumers, further enhancing its revenue potential.

Svenska Cellulosa Aktiebolaget Class A Financial Statement Overview

Summary

Strong balance sheet with low leverage supports resilience, but profitability has cooled since the 2022 peak and return on equity has stepped down. Cash generation is positive, yet free cash flow is volatile and declined in 2025, with inconsistent cash conversion versus net income.

Income Statement

Profitability remains solid over the cycle, with strong operating and cash earnings power in 2021–2024 (net margins ~16%–32% and EBITDA margins ~32%–49%), but the trend has cooled since the 2022 peak. Revenue growth has been volatile and recently weak, with a decline in 2025 (annual revenue down ~1%). A key concern is the 2025 gross profit turning negative while reported net income stayed positive, which signals potential one-offs/reclassifications and reduced quality/visibility of headline margins.

Balance Sheet

The balance sheet is conservatively levered, with debt-to-equity consistently low (~0.12–0.15) and equity forming a large capital base (equity ~SEK 102bn vs. debt ~SEK 15bn in 2025). Asset size and equity have been broadly stable, supporting resilience through a cyclical industry. Return on equity, however, has stepped down materially from 2021–2022 (~7%) to 2023–2025 (~3%–3.5%), pointing to weaker profitability on a sizeable capital base.

Cash Flow

Operating cash generation is positive and fairly steady (roughly SEK 3.5–6.3bn annually), but cash conversion has been inconsistent. Free cash flow is positive yet volatile, and declined sharply in 2025 (down ~24% to ~SEK 1.2bn). Free cash flow has also covered only a modest portion of net income (about 6%–38% across the period; ~30% in 2025), indicating earnings have not consistently translated into cash available for shareholders after investment needs.

Breakdown	Dec 2025	Dec 2024	Dec 2023	Dec 2022	Dec 2021
Income Statement
Total Revenue	20.43B	20.23B	18.08B	20.79B	18.82B
Gross Profit	-365.00M	17.10B	15.66B	17.96B	15.59B
EBITDA	6.57B	7.19B	6.83B	10.22B	9.08B
Net Income	3.21B	3.64B	3.67B	6.75B	5.94B
Balance Sheet
Total Assets	146.46B	149.26B	147.95B	137.35B	118.23B
Cash, Cash Equivalents and Short-Term Investments	590.00M	1.33B	502.00M	836.00M	1.06B
Total Debt	14.94B	13.73B	13.38B	12.21B	9.87B
Total Liabilities	44.94B	45.23B	43.67B	41.00B	35.18B
Stockholders Equity	101.52B	104.03B	104.28B	96.36B	83.06B
Cash Flow
Free Cash Flow	1.20B	1.31B	759.00M	364.00M	863.00M
Operating Cash Flow	4.02B	3.49B	3.89B	6.33B	5.97B
Investing Cash Flow	-2.60B	-1.70B	-3.10B	-6.52B	-4.93B
Financing Cash Flow	-2.14B	-959.00M	-1.12B	-30.00M	-1.27B

Svenska Cellulosa Aktiebolaget Class A Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 123.40
• 50DMA: Positive
• 100DMA: Positive
• 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:SCA.A, the sentiment is Positive. The current price of 123.4 is above the 20-day moving average (MA) of 119.93, above the 50-day MA of 119.48, and below the 200-day MA of 123.82, indicating a neutral trend. The MACD of 1.13 indicates Negative momentum. The RSI at 59.35 is Neutral, neither overbought nor oversold. The STOCH value of 57.46 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for SE:SCA.A.

Svenska Cellulosa Aktiebolaget Class A Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
HOLM.A	63 Neutral	kr56.53B	18.97	5.02%	2.60%	-1.15%	2.30%
Sector *	61 Neutral	$10.43B	7.12	-0.05%	2.87%	2.86%	-36.73%
HOLM.B	61 Neutral	kr56.53B	19.28	―	2.59%	-1.15%	2.30%
SCA.B	59 Neutral	kr86.28B	26.92	3.38%	2.49%	6.10%	-3.62%
STE.A	58 Neutral	kr96.98B	12.66	―	2.50%	3.43%	78.62%
SCA.A	57 Neutral	kr86.28B	26.91	―	2.49%	6.10%	-3.62%
STE.R	55 Neutral	kr96.98B	12.55	―	3.46%	3.43%	78.62%