Volvo AB (VOLV.A) AI Stock Analysis

• Market Cap: kr535.58B
• Dividend Yield: 3.02%
• Average Volume (3M): 105.94K
• Price to Earnings (P/E): 11.6
• Beta (1Y): 1.29
• Revenue Growth: -6.35%
• EPS Growth: -9.41%
• Country: SE
• Employees: 91,154
• Sector: Industrials
• Sector Strength: 90
• Industry: Agricultural - Machinery
• EPS (TTM): 4.86
• Shares Outstanding: 444,966,830
• 10 Day Avg. Volume: 94,543
• 30 Day Avg. Volume: 105,940
• PEG Ratio: -1.41
• Price to Book (P/B): 2.77
• Price to Sales (P/S): 0.00
• P/FCF Ratio: 22.61
• 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: 74 Outperform
• Price Target: kr304.00 ▲(14.63%Upside)

Volvo AB's overall stock score is driven by its strong financial performance and reasonable valuation. Technical analysis shows neutral momentum, suggesting the stock is fairly priced. The absence of significant earnings call data or corporate events means these factors did not influence the score.

Volvo AB Business Overview & Revenue Model

Company Description

AB Volvo (publ), together with its subsidiaries, manufactures and sells trucks, buses, construction equipment, and marine and industrial engines in Europe, North America, South America, Asia, Africa, and Oceania. The company offers trucks for long-haulage, construction, mining, and distribution purposes under the Volvo, UD Trucks, Renault Trucks, Mack, Eicher, Arquus, cellcentric, and Dongfeng Trucks brands; and city and intercity buses, coaches, and bus chassis, as well as associated transport systems under the Prevost and Nova Bus brands. It also provides construction equipment, including excavators, articulated and rigid haulers, wheel loaders, road construction machines, pavers, and compactors under the brand names of Volvo, and SDLG Trucks. In addition, the company offers engines and power solutions for leisure and commercial vessels, as well as for power generation, industrial, and off-road applications under the Volvo Penta brand name. Further, it provides financing, insurance, rental, spare parts, repair, preventive maintenance, service agreement, and assistance services. The company offers its products and services through a network of dealerships and workshops. It has a strategic alliance with Isuzu Motors within commercial vehicles; a partnership with Samsung SDI Co to develop battery packs for its trucks; and an agreement with NVIDIA and Aurora to develop autonomous trucks. AB Volvo (publ) was incorporated in 1915 and is headquartered in Gothenburg, Sweden.

How the Company Makes Money

Volvo AB generates revenue through multiple streams, primarily from the sale of commercial vehicles such as trucks and buses, which form the largest portion of its income. The company also earns significant revenue from its construction equipment division, which includes a variety of machinery for the construction and mining industries. Additionally, Volvo provides engines and power solutions for marine and industrial applications, further contributing to its earnings. Aftermarket services, including maintenance, repairs, and spare parts, provide a stable source of recurring revenue. Volvo's financial services arm also contributes to its revenue by offering leasing and financing solutions to customers, enhancing vehicle sales. The company's strategic partnerships and joint ventures in various regions help it maintain a competitive edge and expand its market reach, thereby supporting its financial performance.

Volvo AB Financial Statement Overview

Summary

Volvo AB demonstrates strong financial health, with robust revenue growth, stable profitability, and effective cost management. The balance sheet shows moderate leverage with a solid equity base, although rising debt levels could pose a risk. Cash flow generation is consistent, but increased capital expenditures have impacted free cash flow, indicating strategic reinvestment.

Income Statement

Volvo AB shows strong revenue growth with a significant increase in total revenue over the years, especially evident in the TTM period. The gross profit margin is strong at 26.72% for TTM, indicating effective cost management. The net profit margin of 8.93% for TTM reflects steady profitability, although slightly lower compared to the previous year. Consistent EBIT and EBITDA margins underscore operational efficiency, with a TTM EBIT margin of 12.04% and an EBITDA margin of 16.81%. Overall, the income statement reflects robust growth and profitability, with minor fluctuations in net income.

Balance Sheet

The balance sheet of Volvo AB shows a stable financial position with a debt-to-equity ratio of 1.30 in the TTM period, indicating a balanced leverage. The equity ratio is healthy at 28.51%, showing a strong equity base relative to total assets. Return on equity (ROE) for TTM stands at 23.56%, demonstrating efficient use of shareholders' funds to generate profits. However, the total debt has increased over the years, which might pose a risk if not managed properly. Overall, the balance sheet reflects a stable financial position with moderate leverage.

Cash Flow

Volvo AB's cash flow statement shows a positive trend with strong operating cash flow generation, amounting to 44.38 billion in the TTM period. Free cash flow is positive, although it has decreased from the previous year, indicating increased capital expenditures. The operating cash flow to net income ratio is close to 1, reflecting effective conversion of income to cash. However, the free cash flow to net income ratio is lower, which indicates a higher reinvestment in the business. Overall, cash flow health is satisfactory, with consistent cash generation but increased investment activity.

Breakdown
TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement		Total Revenue
517.43B	526.82B	552.76B	473.48B	372.22B	338.45B
	Gross Profit
138.19B	144.05B	149.32B	111.74B	89.75B	79.13B
	EBIT
62.32B	66.61B	67.30B	45.71B	43.07B	27.48B
	EBITDA
86.96B	91.35B	88.81B	68.34B	63.13B	43.30B
	Net Income Common Stockholders
46.20B	50.39B	49.83B	32.72B	32.79B	19.32B
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
90.90B	73.49B	73.61B	67.18B	50.79B	71.92B
	Total Assets
687.67B	714.56B	681.81B	629.06B	515.86B	510.82B
	Total Debt
254.39B	258.85B	233.52B	205.05B	151.45B	152.78B
	Net Debt
163.67B	185.58B	159.99B	137.96B	100.83B	81.07B
	Total Liabilities
488.49B	517.20B	501.07B	462.83B	371.74B	362.68B
	Stockholders Equity
196.07B	194.05B	177.79B	162.72B	141.04B	145.29B
Cash Flow		Free Cash Flow
23.63B	28.06B	3.00B	7.40B	11.81B	13.29B
	Operating Cash Flow
44.38B	46.44B	26.68B	33.24B	33.65B	30.61B
	Investing Cash Flow
-22.28B	-24.14B	-26.84B	-21.49B	-1.49B	-9.94B
	Financing Cash Flow
-18.88B	-21.87B	1.82B	7.48B	-57.55B	6.44B

Volvo AB Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 265.20
• 50DMA: Positive
• 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:VOLV.A, the sentiment is Negative. The current price of 265.2 is below the 20-day moving average (MA) of 270.25, above the 50-day MA of 264.06, and below the 200-day MA of 267.47, indicating a neutral trend. The MACD of -1.16 indicates Positive momentum. The RSI at 47.46 is Neutral, neither overbought nor oversold. The STOCH value of 37.35 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for SE:VOLV.A.

Volvo AB Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
VOLV.A	74 Outperform	kr535.58B	11.64	25.90%	3.02%	-6.35%	-9.41%
Sector *	66 Neutral	$4.50B	12.29	5.40%	248.66%	4.13%	-12.33%
0NNF		kr171.24B	22.32	18.80%	2.04%	―	―
0XXV		kr737.87B	23.05	27.15%	2.10%	―	―
0XXT		kr737.87B	26.17	27.15%	1.85%	―	―
0HC0		kr268.19B	18.22	15.81%	2.69%	―	―
EPI.A	80 Outperform	kr251.00B	29.43		1.75%	7.22%	-2.59%