Truck and bus manufacturer Volvo has seen its Buy rating reiterated by Handelsbanken with a price target of SEK 380. The bank continues to see support from a two-year replacement cycle alongside improving truck markets in North America and Europe.
The bank expects adjusted operating profit to increase by 17 percent in 2026, with further growth in 2027. Forecasts for 2026 have been marginally lowered, while 2027 estimates have been raised.
"Volvo shares have risen 8.7 percent year-to-date, slightly outperforming the Nordic engineering sector (+7.4 percent). We believe the current valuation is far too low given the expected recovery in truck markets, as well as completed and ongoing operational improvements," the bank stated.
AB Volvo is the leading European truck maker and No. 3 worldwide. Net sales break down by activity as follows:
- sales of trucks (66.2%): 202,911 vehicles sold in 2025 (names Volvo, Renault, Eicher and Mack);
- sales of construction equipment (16.7%): excavators, loaders, backhoes, hydraulic shovels, graders, dump trucks, etc.;
- financial services (5.4%);
- bus and chassis sales (5.1%): world's No. 2 largest manufacturer;
- sales of parts, control systems, and marine and industrial motors (4.2%): for commerce and cruise ships and for industrial applications (irrigation units, lifting trucks, electrical generators, etc.);
- other (2.4%).
Net sales are distributed geographically as follows: Europe (43.1%), North America (29.3%), Asia (11.5%), South America (9.7%), and Africa & Oceania (6.4%).
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