SB1 Markets has initiated coverage of truck and bus manufacturer Volvo with a Buy recommendation and a target price of 350 kronor.
Analysts highlight the company's strong position in a rational global truck market, characterized by a high proportion of recurring service revenue and demand driven by replacement needs.
At the same time, order intake is assessed to have bottomed out during 2025, with the outlook improving ahead of 2026—particularly in North America, where a stronger order situation is expected to support volumes and margins.
"The valuation is attractive, in our assessment. The stock has risen about 9 percent so far this year compared to 3 percent for the OMXS30, but we believe the stock can continue to outperform during 2026 as market prospects improve and there is a chance for further upward forecast revisions," SB1 writes.
AB Volvo is the leading European truck maker and No. 3 worldwide. Net sales break down by activity as follows:
- sales of trucks (68.4%): 219,377 vehicles sold in 2024 (names Volvo, Renault, Eicher and Mack);
- sales of construction equipment (16.8%): excavators, loaders, backhoes, hydraulic shovels, graders, dump trucks, etc.;
- financial services (5.1%);
- bus and chassis sales (4.7%): world's No. 2 largest manufacturer;
- sales of parts, control systems, and marine and industrial motors (3.8%): for commerce and cruise ships and for industrial applications (irrigation units, lifting trucks, electrical generators, etc.);
- other (1.2%).
Net sales are distributed geographically as follows: Europe (41.1%), North America (30.8%), Asia (11.2%), South America (10.7%), Africa and Oceania (6.2%).
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