Hulk Hogan, wrestling icon, dies at 71 in Florida home
On Tuesday, Bernstein SocGen initiated coverage on shares of Volvo AB (VOLVB:SS) (OTC: OTC:VLVLY), issuing an Underperform rating with a price target of SEK 270.00. The new rating reflects a cautious stance towards the company’s stock, despite acknowledging Volvo’s position as the largest EU-listed truckmaker with a market capitalization of $59.5 billion and its notable diversification. According to InvestingPro data, the company maintains a GOOD financial health score, with strong profitability metrics and a notable dividend yield of 4.62%.
Volvo AB, renowned for its core trucks business which contributes 75% of its EBIT, also operates profitable construction equipment and marine/industrial engine units. These segments are highlighted as distinguishing factors from its competitors and are a justification for the company’s higher valuation multiple according to the analysts. With annual revenue of $47.6 billion and a P/E ratio of 11.8x, InvestingPro analysis indicates the stock is trading near its Fair Value, with 8 additional exclusive insights available to subscribers.
The research firm’s analysts projected market share gains for Volvo, especially from its new VNL Class 8 models in the United States. This optimism is based on proprietary analysis of the Total (EPA:TTEF) Cost of Ownership (TCO). Nevertheless, Bernstein SocGen’s forecasts for Volvo’s performance in 2025 and 2026 remain over 15% below the consensus.
The valuation of Volvo by Bernstein SocGen is set at 11 times the firm’s forecasted free cash flow (FFC), which is slightly above the company’s long-term average price-to-earnings (P/E) multiple of 12 times. Despite the potential positives, the Underperform rating suggests that the analysts foresee challenges ahead that could impact the stock’s performance.
In other recent news, Volvo AB has seen several significant developments. UBS upgraded Volvo’s stock rating from Neutral to Buy, raising the price target to SEK 370.00, citing a positive outlook on the European truck market. UBS analyst Hemal Bhundia expects Volvo’s truck deliveries to remain stable, contrary to a consensus predicting a decline, and foresees organic growth in the Truck and Construction Equipment (CE) segments by the second half of 2025. Meanwhile, JPMorgan maintained its Overweight rating with a SEK 330.00 price target, noting a rebound in order intake for trucks and construction equipment despite a slight miss in fourth-quarter earnings expectations. JPMorgan anticipates a recovery in Volvo’s truck margins and projects industrial margins of approximately 13% for 2025 and 2026. Morgan Stanley (NYSE:MS) also upgraded Volvo’s stock rating to Overweight, increasing the price target to SEK 323.00, emphasizing Volvo’s strong cycle management and resilience in maintaining solid margins. The firm highlighted the potential impact of the Environmental Protection Agency (EPA) ’27 pre-buy effect on demand in the latter half of 2025. Morgan Stanley projects a steady dividend yield of around 6% and has adjusted its bear case scenario to reflect higher earnings per share expectations. These recent developments underscore the varied yet optimistic outlooks from analysts regarding Volvo’s financial performance and market positioning.
This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.