SKF AB (SKFRY) AI Stock Analysis

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SKF AB

(OTC:SKFRY)

72Outperform

SKF AB's overall score reflects strong financial stability and healthy valuation metrics, counterbalanced by technical indicators showing moderate momentum. While earnings call insights reveal resilience in margins and cash flow, ongoing challenges in organic growth and specific regional markets temper the outlook. The absence of debt is a considerable strength, reducing risk and supporting future strategic initiatives.

SKF AB (SKFRY) vs. S&P 500 (SPY)

Market Cap

$8.00B

Dividend Yield2.77%

Average Volume (3M)19.94K

Price to Earnings (P/E)13.3

Beta (1Y)1.07

Revenue Growth-4.62%

EPS Growth1.53%

CountryUS

Employees37,861

SectorIndustrials

Sector Strength70

IndustryManufacturing - Tools & Accessories

Share Statistics

EPS (TTM)0.38

Shares Outstanding426,392,060

10 Day Avg. Volume20,885

30 Day Avg. Volume19,939

Financial Highlights & Ratios

PEG RatioN/A

Price to Book (P/B)N/A

Price to Sales (P/S)0.93

Price to Cash Flow (P/CF)N/A

P/FCF Ratio0.00

Enterprise Value/Market CapN/A

Enterprise Value/RevenueN/A

Enterprise Value/Gross ProfitN/A

Enterprise Value/EbitdaN/A

Forecast

1Y Price TargetN/A

Price Target UpsideN/A

Rating ConsensusN/A

Number of Analyst Covering0

SKF AB Business Overview & Revenue Model

Company DescriptionSKF AB (SKFRY) is a leading global industrial company specializing in the production and distribution of bearings, seals, lubrication systems, and related services. Headquartered in Gothenburg, Sweden, SKF serves a wide range of industries, including automotive, aerospace, renewable energy, and industrial machinery. The company's core products and services are designed to improve rotational motion and reduce friction, leading to enhanced performance and efficiency in machinery and equipment.

How the Company Makes MoneySKF AB generates revenue through the sale of its diverse range of bearings and related products. The company's primary revenue streams include the manufacturing and distribution of bearings, seals, and lubrication systems. SKF also provides value-added services such as condition monitoring, maintenance services, and technical support, which contribute to its earnings. Strategic partnerships and collaborations with major industrial players and OEMs enhance its market presence and drive sales. Additionally, SKF invests in research and development to innovate and maintain a competitive edge in the evolving industrial landscape.

SKF AB Financial Statement Overview

Summary

SKF AB demonstrates robust financial health with significant strengths in balance sheet stability and consistent income statement performance. While cash flow generation is strong, recent declines in free cash flow warrant attention. The company's risk profile is low due to the absence of debt, positioning it well for future opportunities.

Income Statement

Positive

SKF AB's revenue has shown a steady growth trajectory with a recent slight decline from 2023 to 2024. Gross and EBIT margins have improved over the years, reflecting efficiency and cost control. The net profit margin has remained stable, indicating consistent profitability. However, the recent minor revenue drop might signal a need for strategic adjustments.

Balance Sheet

Very Positive

The company exhibits strong financial stability with no total debt in 2024, improving its debt-to-equity ratio significantly. Equity growth has been consistent, contributing positively to the equity ratio. Return on Equity is solid, highlighting effective use of shareholder funds. The zero-debt position reduces financial risk significantly.

Cash Flow

Positive

Operating cash flow has shown fluctuations, but overall, it supports net income well. Free cash flow has decreased in recent periods, suggesting potential reinvestment or cash management challenges. Despite this, operating cash flows remain healthy, indicating good cash generation from core operations.

Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Breakdown
Income Statement		Total Revenue
98.72B	103.88B	96.93B	81.73B	74.85B
	Gross Profit
27.37B	26.34B	24.47B	23.27B	16.99B
	EBIT
10.34B	11.08B	8.53B	10.76B	7.07B
	EBITDA
14.77B	14.78B	12.28B	13.82B	10.23B
	Net Income Common Stockholders
6.47B	6.39B	4.47B	7.33B	4.30B
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
11.36B	13.32B	11.22B	13.66B	14.64B
	Total Assets
119.41B	111.90B	110.92B	99.63B	90.56B
	Total Debt
20.04B	21.69B	21.27B	19.21B	17.82B
	Net Debt
9.01B	8.38B	11.01B	5.99B	3.77B
	Total Liabilities
57.44B	56.95B	56.88B	54.26B	54.84B
	Stockholders Equity
59.65B	52.74B	51.93B	43.65B	34.31B
Cash Flow		Free Cash Flow
5.11B	8.02B	428.00M	1.36B	4.89B
	Operating Cash Flow
10.79B	13.78B	5.64B	5.25B	8.27B
	Investing Cash Flow
-5.60B	-5.87B	-5.35B	-3.15B	-3.01B
	Financing Cash Flow
-7.57B	-4.51B	-3.40B	-3.51B	2.69B

SKF AB Technical Analysis

Technical Analysis Sentiment

Negative

Last Price17.31

Price Trends

50DMA

20.38

Negative

100DMA

19.64

Negative

200DMA

19.02

Negative

Market Momentum

MACD

-0.97

Positive

RSI

42.66

Neutral

STOCH

55.95

Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For SKFRY, the sentiment is Negative. The current price of 17.31 is below the 20-day moving average (MA) of 19.17, below the 50-day MA of 20.38, and below the 200-day MA of 19.02, indicating a bearish trend. The MACD of -0.97 indicates Positive momentum. The RSI at 42.66 is Neutral, neither overbought nor oversold. The STOCH value of 55.95 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for SKFRY.

SKF AB Peers Comparison

Overall Rating

UnderperformOutperform

Sector (62)

Financial Indicators

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
SNA	79 Outperform	$17.62B	17.23	19.95%	2.38%	<0.01%	3.74%
RBC	78 Outperform	$10.53B	45.97	8.35%	―	4.62%	21.58%
SKFRY	72 Outperform	$8.00B	13.33	11.53%	2.77%	-4.62%	1.53%
LECO	71 Outperform	$10.08B	22.08	35.36%	1.61%	-4.23%	-13.42%
TKR	62 Neutral	$4.31B	12.33	13.04%	2.21%	-4.11%	-8.74%
Sector *	62 Neutral	$7.70B	13.14	3.53%	3.32%	3.90%	-14.25%
SWK	47 Neutral	$9.29B	31.76	3.22%	5.54%	-2.63%	―

* Industrials Sector Average

Performance Comparison

SKFRY

SKF AB

18.24

-1.06

-5.49%

LECO

Lincoln Electric Holdings

179.95

-55.89

-23.70%

RBC

RBC Bearings

335.03

84.87

33.93%

SNA

Snap-on

336.89

61.66

22.40%

SWK

Stanley Black & Decker

60.10

-26.86

-30.89%

TKR

Timken Company

61.89

-21.49

-25.77%

SKF AB Earnings Call Summary

Earnings Call Date: Oct 29, 2025 | % Change Since: -14.14% | Next Earnings Date: Jan 30, 2026

Earnings Call Sentiment Neutral

SKF demonstrated resilience in maintaining margins and strong cash flow despite facing multiple challenges including negative organic growth, particularly in the automotive segment and in China. Regionalization efforts and growth in select markets like Americas were positive, but overall, the challenges balanced out the achievements.

Highlights

Resilient Operating Margin

Despite facing a challenging market with a negative organic growth of minus 3% in Q4 and minus 5% for the full year, SKF maintained its operating margin close to the previous year's levels, demonstrating strong margin resilience.

Strong Cash Generation

SKF reported robust cash flow of SEK3.3 billion in Q4 and almost SEK11 billion for the full year, showcasing effective cash management despite a challenging environment.

Increased Dividend Proposal

SKF proposed a slight increase in dividends from SEK750 to SEK775, reflecting confidence in their financial foundation and future growth prospects.

Regionalization Progress

Significant advancements were made in regionalization efforts, with Americas reaching 70% and Asia 68%, up by 3 and 5 percentage points respectively.

Positive Growth in Americas and Southeast Asia

Americas returned to growth with strong net sales, and high activity levels were noted in India, Indonesia, and Vietnam.

Lowlights

Six Consecutive Quarters of Negative Organic Growth

SKF reported a sixth consecutive quarter of negative organic growth, with a 3% decline in Q4.

Significant Challenges in Automotive Segment

The automotive segment faced a significant negative organic growth of 4% and a weak adjusted operating margin of 2.6% in the fourth quarter.

Negative Growth in China and Northeast Asia

China and Northeast Asia experienced significant negative organic growth, impacted by low activity in the wind industry and destocking in industrial distribution.

FX Headwinds Impacting Margins

Foreign exchange headwinds had a negative impact of 0.9 percentage points on the operating margin in Q4.

Company Guidance

During SKF's earnings call for the fourth quarter of 2024, the company provided guidance for the first quarter of 2025, expecting a somewhat weakened year-over-year organic sales outlook. Despite reporting a sixth consecutive quarter of negative organic growth at -3%, SKF maintained a robust margin resilience, with an adjusted operating margin slightly above 11%. The full year saw net sales close to SEK 100 billion and a strong cash generation of nearly SEK 11 billion. The regionalization efforts were highlighted, with Americas and Asia achieving regionalization rates of 70% and 68%, respectively. SKF also announced an increase in the proposed dividend from SEK 750 to SEK 775. The call emphasized the ongoing separation of the Industrial and Automotive businesses, with a Capital Markets Day scheduled for November 11, 2025, to provide further details.

Glossary

OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.

NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.

UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.

Disclaimer

This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.