Softronic AB Class B (SOF.B) AI Stock Analysis

• Market Cap: kr1.10B
• Dividend Yield: 6.29%
• Average Volume (3M): 30.88K
• Price to Earnings (P/E): 16.4
• Beta (1Y): -0.05
• Revenue Growth: 4.00%
• EPS Growth: -12.08%
• Country: SE
• Employees: 445
• Sector: Technology
• Sector Strength: 88
• Industry: Information Technology Services
• EPS (TTM): N/A
• Shares Outstanding: 49,632,805
• 10 Day Avg. Volume: 28,658
• 30 Day Avg. Volume: 30,880
• PEG Ratio: -0.93
• Price to Book (P/B): 3.97
• Price to Sales (P/S): 1.26
• P/FCF Ratio: 0.00
• 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: 59 Neutral
• Price Target: kr22.00 ▲(0.00% Upside)
• Action: Downgraded Date: 02/18/26
• Date: Action: Downgraded 02/18/26

The score is held back primarily by weakening 2025 financial quality (notable margin compression and free cash flow dropping to zero) and bearish technical momentum (below key moving averages with negative MACD). These are partly offset by a strong balance sheet and a comparatively supportive valuation with a high dividend yield.

Positive Factors

Strong balance sheet

Low leverage and a conservatively financed balance sheet provide durable financial flexibility. With debt-to-equity around 0.09, Softronic can fund investments, absorb revenue variability, and support operations or dividends without immediate refinancing risk, strengthening resilience over months.

Recurring managed-services revenue

A business mix that includes managed services and outsourcing creates recurring, contractually backed revenue streams. These contracts improve predictability, support retention and cross-sell, and anchor client relationships—advantages that stabilize revenue and margins over the medium term.

Prior strong cash generation

Historically strong free cash flow demonstrates the company’s ability to convert earnings into cash. That track record implies management can restore cash conversion through working-capital and operational fixes, and provides a foundation for funding growth or payouts once the 2025 setback is addressed.

Negative Factors

Sharp margin compression

A roughly halved gross margin signals structural pressure from pricing, cost inflation, or adverse project mix. Sustained lower gross margins erode the company’s buffer to cover fixed costs and investments, forcing either efficiency gains or price recovery to restore long-term profitability.

Free cash flow collapsed

FCF falling to zero sharply reduces internal funding capacity for capex, acquisitions, or shareholder returns. Even with positive operating cash flow, the collapse indicates working-capital or investment timing issues that constrain financial flexibility and raise execution risk over the coming months.

Earnings and margin deterioration

Declining net and operating margins, alongside negative EPS growth, weaken the company’s earnings power. Persisting margin deterioration reduces reinvestment capacity and makes it harder to fund strategic initiatives, increasing the likelihood of cost-cutting or margin-restoration measures that may affect growth.

Softronic AB Class B Business Overview & Revenue Model

Company Description

Softronic AB (publ) provides IT and management services primarily in Sweden. It offers AI, AML, automation, business development, case management system, cloud, customer relationship management, ERP systems, management, Microsoft, operation, information security, vulnerability analyses, UX/design, web, and system solutions, as well as consultancy services. The company was incorporated in 1984 and is headquartered in Stockholm, Sweden.

How the Company Makes Money

Softronic generates revenue primarily through its IT consulting and software development services. The company's revenue model is based on a combination of project-based fees, ongoing maintenance contracts, and subscription-based services for its software products. Key revenue streams include consulting services for system integration projects, custom software development contracts, and recurring revenues from cloud-based solutions. Additionally, Softronic has established strategic partnerships with technology providers and platform vendors, which enhance its service offerings and drive new business opportunities. These partnerships often lead to joint projects and collaborative solutions, further contributing to the company's earnings.

Softronic AB Class B Financial Statement Overview

Summary

Mixed fundamentals: modest revenue growth but a sharp 2025 margin compression (gross margin ~9.1% vs ~18.3% prior year) and free cash flow falling to zero despite positive operating cash flow. Balance sheet strength (low leverage, debt-to-equity ~0.09) supports stability, but profitability and cash conversion are key near-term risks.

Income Statement

Revenue has grown modestly over time (2025: +3.8% vs. 2024: ~flat), but profitability weakened meaningfully in 2025: gross margin fell to ~9.1% from ~18.3% in 2024, and net margin declined to ~7.3% from ~9.8%. EBIT and EBITDA margins also stepped down, indicating higher cost pressure or mix shift. Net income remains positive, but the sharp margin compression in the latest year is a key watch item.

Balance Sheet

The balance sheet looks conservatively financed with low leverage: debt-to-equity remains ~0.09 in 2025 (and generally low across the period), supported by a solid equity base. Total assets have been stable-to-growing, and debt levels are manageable. The main weakness is that equity is slightly lower versus 2024, but overall financial flexibility appears strong given the modest debt load.

Cash Flow

Cash generation became less supportive in 2025. Operating cash flow was positive (85.2m), but free cash flow dropped to zero (down from 110.4m in 2024), creating a clear deterioration in cash conversion. Operating cash flow also covered a smaller share of earnings in 2025 than in 2024, pointing to weaker working-capital dynamics and/or higher investment needs. Prior years showed strong free cash flow relative to net income, but the latest year is a notable setback.

Breakdown	Dec 2025	Dec 2024	Dec 2023	Mar 2023	Dec 2021
Income Statement
Total Revenue	915.80M	842.40M	837.52M	797.12M	786.52M
Gross Profit	83.30M	154.07M	153.22M	144.30M	144.45M
EBITDA	104.40M	118.54M	122.10M	105.73M	117.04M
Net Income	66.70M	82.32M	84.04M	68.22M	73.71M
Balance Sheet
Total Assets	478.00M	450.86M	459.41M	433.85M	428.03M
Cash, Cash Equivalents and Short-Term Investments	111.30M	135.43M	107.90M	117.00M	130.61M
Total Debt	27.10M	24.16M	32.80M	45.92M	9.40M
Total Liabilities	186.20M	154.61M	174.43M	180.28M	171.63M
Stockholders Equity	291.80M	296.25M	284.98M	253.57M	256.40M
Cash Flow
Free Cash Flow	0.00	110.40M	55.50M	72.82M	109.29M
Operating Cash Flow	85.20M	114.37M	56.20M	80.61M	111.27M
Investing Cash Flow	-25.10M	-3.97M	-700.00K	-8.19M	-2.38M
Financing Cash Flow	-84.20M	-82.87M	-64.60M	-86.03M	-178.06M

Softronic AB Class B Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 22.00
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Positive
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For SE:SOF.B, the sentiment is Negative. The current price of 22 is above the 20-day moving average (MA) of 21.21, above the 50-day MA of 21.61, and below the 200-day MA of 22.52, indicating a bearish trend. The MACD of -0.26 indicates Positive momentum. The RSI at 39.48 is Neutral, neither overbought nor oversold. The STOCH value of 53.33 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for SE:SOF.B.

Softronic AB Class B Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
EXS	65 Neutral	kr1.57B	19.00	15.90%	1.13%	10.92%	-2.56%
CAG	63 Neutral	kr749.01M	15.90	―	3.83%	-4.42%	-6.27%
PACT	62 Neutral	kr2.63B	21.40	14.35%	2.13%	-4.36%	-31.55%
Sector *	61 Neutral	$37.18B	12.37	-10.20%	1.83%	8.50%	-7.62%
SOF.B	59 Neutral	kr1.10B	16.37	27.44%	6.29%	4.00%	-12.08%
KNOW	58 Neutral	kr3.04B	-10.62	2.38%	2.03%	-9.85%	-38.24%
B3	43 Neutral	kr326.20M	30.20	1.19%	―	13.21%	-97.19%