UL Solutions Inc. Class A (ULS) AI Stock Analysis

• Market Cap: $15.72B
• Dividend Yield: 0.67%
• Average Volume (3M): 1.22M
• Price to Earnings (P/E): 46.7
• Beta (1Y): 0.52
• Revenue Growth: 6.68%
• EPS Growth: 11.55%
• Country: US
• Employees: 14,813
• Sector: Industrials
• Sector Strength: 72
• Industry: Specialty Business Services
• EPS (TTM): 0.56
• Shares Outstanding: 62,882,236
• 10 Day Avg. Volume: 2,697,139
• 30 Day Avg. Volume: 1,215,484
• PEG Ratio: 1.21
• Price to Book (P/B): 11.04
• Price to Sales (P/S): 3.48
• P/FCF Ratio: 34.76
• Enterprise Value/Market Cap: 0.95
• Enterprise Value/Revenue: 4.96
• Enterprise Value/Gross Profit: 10.19
• Enterprise Value/Ebitda: 21.71
• 1Y Price Target: $89.00
• Price Target Upside: 13.80% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 5
• EPS Forecast (FY): 1.89
• Revenue Forecast (FY): $3.05B

• Rating: 74 Outperform
• Price Target: $101.00 ▲(29.14% Upside)

UL Solutions Inc. exhibits strong financial performance and positive earnings call sentiment, driving a high overall score. However, technical indicators suggest caution due to potential overbought conditions, and valuation metrics indicate the stock may be overvalued. These factors balance the overall score to a moderate level.

Positive Factors

Revenue Growth

Strong revenue growth across all segments signifies robust demand for UL Solutions' services, enhancing its market position and supporting long-term financial health.

Cash Flow Generation

Significant free cash flow growth indicates strong cash generation ability, supporting investment in growth initiatives and providing financial flexibility.

Expansion of Testing Services

Expanding certification services for electric vehicles aligns with industry trends, positioning UL Solutions to capture new market opportunities and drive future growth.

Negative Factors

Restructuring Initiative

The restructuring initiative, while aimed at cost reduction, may disrupt operations and employee morale, potentially impacting service delivery and growth.

Challenges in China

Economic challenges in China could hinder UL Solutions' growth in a key market, affecting revenue and profitability from the region.

Potential Revenue Slowdown

A potential revenue slowdown in Q4 due to tough comparisons and tariff impacts may signal challenges in sustaining growth momentum.

UL Solutions Inc. Class A Business Overview & Revenue Model

Company Description

UL Solutions Inc. Class A (ULS) is a global leader in safety science, specializing in testing, inspection, certification, and advisory services across various industries. The company operates in multiple sectors, including consumer products, construction, electronics, and energy, providing core services such as product safety testing, performance testing, regulatory compliance, and sustainability consulting. With a mission to promote safe living and working environments, UL Solutions delivers innovative solutions that help businesses meet regulatory requirements and enhance product quality.

How the Company Makes Money

UL Solutions generates revenue primarily through its comprehensive suite of testing and certification services. The company charges fees for testing products to ensure compliance with safety and performance standards, which can vary significantly depending on the complexity and volume of testing required. Additionally, ULS earns income from consulting services that assist organizations in navigating regulatory frameworks and improving product safety and sustainability practices. Strategic partnerships with industry stakeholders, regulatory bodies, and manufacturers enhance its market reach and reliability, further driving revenue growth. Furthermore, ULS invests in research and development to expand its service offerings, thereby creating new revenue streams while maintaining its competitive edge in the safety science sector.

UL Solutions Inc. Class A Financial Statement Overview

Summary

UL Solutions Inc. shows strong financial performance with consistent revenue growth, robust profitability, and effective cash flow management. The company has improved its leverage, enhancing financial stability. While the equity ratio suggests a balanced capital structure, further strengthening of equity could enhance long-term resilience.

Income Statement

UL Solutions Inc. demonstrates strong revenue growth with a TTM (Trailing-Twelve-Months) increase of 4.63% from the previous year. The company maintains healthy gross and net profit margins of 48.68% and 11.29%, respectively, indicating efficient cost management and profitability. The EBIT and EBITDA margins are also robust at 11.52% and 21.31%, respectively, reflecting solid operational performance. Overall, the income statement reflects a positive growth trajectory and strong profitability.

Balance Sheet

The balance sheet shows a significant improvement in the debt-to-equity ratio, reducing from 1.63 to 0.60 in the TTM, indicating better leverage management. The return on equity remains strong at 32.39%, showcasing effective use of equity to generate profits. However, the equity ratio is moderate, suggesting a balanced capital structure. The company has made progress in strengthening its financial stability, though there is room for further improvement in equity levels.

Cash Flow

The cash flow statement highlights a notable free cash flow growth rate of 6.87% in the TTM, indicating improved cash generation capabilities. The operating cash flow to net income ratio is 0.78, and the free cash flow to net income ratio is 0.63, both reflecting efficient cash conversion. The company demonstrates strong cash flow management, supporting its operational and financial activities effectively.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	3.00B	2.87B	2.68B	2.52B	2.52B	2.30B
Gross Profit	1.46B	1.38B	1.26B	1.21B	1.18B	1.03B
EBITDA	686.00M	642.00M	535.00M	535.00M	417.00M	481.00M
Net Income	339.00M	326.00M	260.00M	293.00M	224.00M	231.00M
Balance Sheet
Total Assets	2.90B	2.80B	2.74B	2.72B	3.66B	3.55B
Cash, Cash Equivalents and Short-Term Investments	255.00M	298.00M	315.00M	373.00M	1.38B	971.00M
Total Debt	736.00M	935.00M	1.06B	660.00M	154.00M	161.00M
Total Liabilities	1.68B	1.87B	2.06B	1.64B	1.33B	1.28B
Stockholders Equity	1.19B	904.00M	654.00M	1.05B	2.31B	2.25B
Cash Flow
Free Cash Flow	389.00M	287.00M	252.00M	208.00M	314.00M	368.00M
Operating Cash Flow	586.00M	524.00M	467.00M	372.00M	421.00M	487.00M
Investing Cash Flow	-242.00M	-234.00M	-175.00M	-238.00M	178.00M	-344.00M
Financing Cash Flow	-396.00M	-284.00M	-294.00M	-1.12B	-228.00M	-20.00M

UL Solutions Inc. Class A Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 78.21
• 50DMA: Negative
• 100DMA: Positive
• 200DMA: Positive
• MACD: Positive
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For ULS, the sentiment is Positive. The current price of 78.21 is below the 20-day moving average (MA) of 82.41, below the 50-day MA of 81.23, and above the 200-day MA of 69.08, indicating a neutral trend. The MACD of -1.55 indicates Positive momentum. The RSI at 41.17 is Neutral, neither overbought nor oversold. The STOCH value of 45.12 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for ULS.

UL Solutions Inc. Class A Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
ULS	74 Outperform	$15.72B	46.68	32.83%	0.67%	6.68%	11.55%
MMS	74 Outperform	$4.82B	16.07	18.14%	1.38%	2.36%	11.30%
GPN	70 Outperform	$19.47B	11.54	6.72%	1.22%	-11.30%	34.28%
ARMK	68 Neutral	$9.93B	30.92	10.55%	1.15%	6.35%	24.07%
RTO	66 Neutral	$14.56B	43.66	5.86%	2.27%	1.56%	-32.50%
CBZ	66 Neutral	$2.86B	34.44	7.44%	―	59.19%	-35.47%
Sector *	63 Neutral	$10.79B	15.43	7.44%	2.01%	2.89%	-14.66%

UL Solutions Inc. Class A Corporate Events

UL Solutions Inc. Completes Stock Sale Agreement

On December 3, 2025, UL Solutions Inc. entered into an underwriting agreement with Goldman Sachs & Co. LLC and J.P. Morgan Securities LLC for the sale of 12,500,000 shares of its Class A common stock at $78.00 per share. The offering, which closed on December 5, 2025, did not provide any proceeds to the company, as the shares were sold by a selling stockholder. The selling stockholder also granted the underwriters a 30-day option to purchase an additional 1,875,000 shares.

UL Solutions Announces Restructuring to Cut Costs

On November 4, 2025, UL Solutions Inc. announced a restructuring initiative aimed at reducing expenses and exiting non-strategic business lines, with expected pre-tax expenses of $42-$47 million. The plan, primarily affecting the Consumer and Industrial segments, is anticipated to be completed by the first quarter of 2027, potentially improving annual operating income by $25-$30 million. The announcement follows strong third-quarter results for 2025, where the company reported a 7.1% revenue increase to $783 million and a 12.8% rise in net income to $106 million, driven by organic growth and operating leverage across its segments.

UL Solutions Inc. Secures $1 Billion Credit Agreement

On October 28, 2025, UL Solutions Inc. entered into a Credit Agreement establishing a $1.0 billion senior unsecured five-year multi-currency revolving facility with Bank of America, N.A. and other lenders. This agreement includes a $25 million sub-limit for letters of credit and an option to increase the facility by up to $500 million. The company borrowed $291 million under this facility to refinance its 2022 Credit Facility and plans to use additional borrowings for general corporate purposes. The facility, which matures on October 28, 2030, has specific interest rates and financial covenants, including a consolidated net leverage ratio requirement. The agreement impacts the company’s financial operations by providing flexibility for future borrowings and acquisitions, while also imposing certain financial and operational covenants.