SB1 Markets has initiated coverage on automaker Volvo Cars with a neutral rating and a price target of SEK 25. The bank notes that the stock is trading at approximately 5x adjusted EV/EBIT for 2026 and 3x for 2027, which is considered to provide clear valuation support.
At the same time, SB1 sees limited short-term upside as Geely remains a long-term seller, investor confidence needs to be rebuilt, and operational performance must stabilize.
The bank highlights the successful production on the SPA3 platform as a critical step toward strengthening market confidence and enabling a future rerating of the stock.
Volvo Car AB is a Sweden-based automotive brand. Volvo Car Group is focused on the design, engineering, manufacturing, distribution and sale of passenger cars, with particular focus on sustainability, fully electric cars and direct consumer relations, including subscription and other new mobility services. Volvo Car Group’s addressable market is the global premium passenger car market. Moreover, the Company’s intention is to be a pure electric car company and as a result it is undergoing a shift in its business model to a direct sales model in most of its markets. Volvo Cars’ commitment to electrification also results in the launch of Polestar, a progressive stand-alone electric performance car brand, in which Volvo Cars owns shares. Volvo Cars also holds shares in the automotive brand LYNK&CO, which focuses on young open-minded urban people through a flexible customer offering.
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Investor
Investor
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Global
Global
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Quality
Quality
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ESG MSCI
ESG MSCI
The MSCI ESG score assesses a company’s environmental, social, and governance practices relative to its industry peers. Companies are rated from CCC (laggard) to AAA (leader). This rating helps investors incorporate sustainability risks and opportunities into their investment decisions.
