Volvo AB (VOLV.B) AI Stock Analysis

• Market Cap: kr524.33B
• Dividend Yield: 6.54%
• Average Volume (3M): 3.39M
• Price to Earnings (P/E): 14.7
• Beta (1Y): 1.40
• Revenue Growth: -7.96%
• EPS Growth: -31.18%
• Country: SE
• Employees: 91,154
• Sector: Industrials
• Sector Strength: 72
• Industry: Agricultural - Machinery
• EPS (TTM): 3.71
• Shares Outstanding: 1,588,953,400
• 10 Day Avg. Volume: 4,677,128
• 30 Day Avg. Volume: 3,385,933
• PEG Ratio: 9.84
• Price to Book (P/B): 2.81
• Price to Sales (P/S): 1.04
• P/FCF Ratio: 19.47
• 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: kr297.20
• Price Target Upside: 5.05% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 10
• EPS Forecast (FY): N/A
• Revenue Forecast (FY): N/A

• Rating: 75 Outperform
• Price Target: kr308.00 ▲(8.87% Upside)

Volvo AB's stock is supported by strong technical indicators and a solid valuation, with a reasonable P/E ratio and attractive dividend yield. Financial performance is stable, though there are challenges with revenue growth and cash flow. The absence of earnings call and corporate events data limits the analysis to these factors.

Positive Factors

Profitability

Strong profitability and efficient use of equity suggest Volvo AB's ability to sustain operations and invest in growth, supporting long-term financial health.

Margin Sustainability

Sustained margins indicate effective cost management and pricing power, contributing to long-term financial stability and competitive advantage.

Market Position

Strong market position in key industries provides Volvo with competitive advantages, enabling it to leverage brand strength and customer loyalty for future growth.

Negative Factors

Revenue Growth Challenges

Declining revenue growth suggests potential market challenges and could impact future profitability if not addressed through strategic initiatives.

High Leverage

High leverage increases financial risk and limits flexibility, potentially impacting Volvo's ability to invest in growth or weather economic downturns.

Cash Flow Generation

Declining cash flow generation may hinder Volvo's ability to fund operations and investments, increasing reliance on external financing and impacting long-term sustainability.

Volvo AB Business Overview & Revenue Model

Company Description

Volvo AB is a Swedish multinational manufacturing company that primarily specializes in the production of automobiles, trucks, construction equipment, and marine and industrial engines. The company operates through several business segments, including Volvo Cars, which focuses on passenger vehicles; Volvo Trucks, providing heavy-duty trucks; and Volvo Construction Equipment, offering a range of construction machinery. With a strong emphasis on safety, sustainability, and innovation, Volvo has established itself as a leading player in the automotive and machinery markets.

How the Company Makes Money

Volvo AB generates revenue through multiple streams across its various business segments. The primary revenue source comes from the sale of vehicles under the Volvo brand, including passenger cars and commercial trucks. Additionally, the company earns income from its construction equipment segment, which sells machinery for various industries, including construction and mining. Aftermarket services, including parts and maintenance, contribute significantly to Volvo's revenue, providing ongoing support and service to customers. Furthermore, strategic partnerships with other firms, such as collaborations in electric vehicle technology and innovations in autonomous driving, bolster its market position and enhance revenue potential. The company also conducts financial services, offering leasing and financing solutions that provide additional revenue opportunities.

Volvo AB Financial Statement Overview

Summary

Volvo AB demonstrates strong profitability and efficient equity utilization, but faces challenges with revenue growth and cash flow generation. The high leverage poses a risk, but the company manages to maintain healthy margins. Continued focus on improving cash flow and reducing debt could enhance financial stability.

Income Statement

Volvo AB's income statement shows a mixed performance. The TTM (Trailing-Twelve-Months) data indicates a decline in revenue growth rate by -1.26%, reflecting a challenging market environment. However, the company maintains solid profitability with a gross profit margin of 25.16% and a net profit margin of 7.61%. Despite the revenue decline, the EBIT and EBITDA margins remain healthy at 10.51% and 15.21%, respectively, indicating effective cost management.

Balance Sheet

The balance sheet reveals a high debt-to-equity ratio of 1.62 in the TTM, suggesting significant leverage. However, the return on equity remains strong at 20.76%, indicating efficient use of equity to generate profits. The equity ratio stands at 26.64%, reflecting a moderate level of financial stability.

Cash Flow

Cash flow analysis shows a decline in free cash flow growth by -10.81% in the TTM, indicating potential liquidity challenges. The operating cash flow to net income ratio is 0.14, and the free cash flow to net income ratio is 0.46, suggesting that cash generation relative to net income is moderate. This could impact the company's ability to fund operations and investments without relying on external financing.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	493.79B	526.82B	552.76B	473.48B	372.22B	338.45B
Gross Profit	121.31B	144.05B	149.32B	111.74B	89.75B	79.13B
EBITDA	74.95B	91.35B	88.81B	67.01B	63.13B	43.30B
Net Income	35.58B	50.39B	49.83B	32.72B	32.79B	19.32B
Balance Sheet
Total Assets	644.98B	714.56B	674.07B	629.06B	515.86B	510.82B
Cash, Cash Equivalents and Short-Term Investments	57.12B	73.49B	73.61B	67.18B	50.79B	71.92B
Total Debt	250.90B	258.85B	233.52B	205.05B	151.45B	152.78B
Total Liabilities	473.11B	517.20B	493.33B	462.83B	371.74B	362.68B
Stockholders Equity	171.80B	194.05B	177.79B	162.72B	141.04B	145.29B
Cash Flow
Free Cash Flow	17.56B	28.06B	-1.99B	7.40B	11.81B	13.29B
Operating Cash Flow	42.25B	46.44B	26.68B	33.24B	33.65B	30.61B
Investing Cash Flow	-26.34B	-24.14B	-26.84B	-21.49B	-1.49B	-9.94B
Financing Cash Flow	-24.50B	-21.87B	1.82B	7.48B	-57.55B	6.44B

Volvo AB Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 282.90
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Neutral
• STOCH: Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For SE:VOLV.B, the sentiment is Positive. The current price of 282.9 is above the 20-day moving average (MA) of 269.76, above the 50-day MA of 267.27, and above the 200-day MA of 274.50, indicating a bullish trend. The MACD of 4.80 indicates Negative momentum. The RSI at 67.28 is Neutral, neither overbought nor oversold. The STOCH value of 89.84 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for SE:VOLV.B.

Volvo AB Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
HEXA.B	78 Outperform	kr309.37B	40.83	6.71%	1.42%	-0.93%	-34.25%
VOLV.B	75 Outperform	kr524.33B	14.73	20.27%	6.54%	-7.96%	-31.18%
ALFA	71 Outperform	kr184.01B	22.06	20.42%	1.91%	3.54%	20.94%
SAND	70 Outperform	kr352.23B	23.82	16.39%	2.02%	-1.77%	21.13%
EPI.A	67 Neutral	kr228.51B	27.67	―	1.88%	2.00%	-0.25%
Sector *	63 Neutral	$10.79B	15.43	7.44%	2.01%	2.89%	-14.66%
SKF.B	60 Neutral	kr112.50B	23.11	8.90%	3.13%	-4.16%	-12.95%