Atlas Copco AB

Financial Performance

5Y price score: 67

10Y return: 313.5%

DATE RANGE:

SEK Per
Share

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148.4

52-week range

212.3

206.8

Your model inputs

Required return / cost of capital

FCFF terminal growth rate

Your fair value & Margin of safety

To calculate fair value based on cost of capital and terminal growth assumptions above, please select free cash flow forecast.

Forecast:

Valuation

Free Cash Flow Yield

2.8 %

Dividend Yield TTM

1.9 %

Market cap

1,007,681

Price / Earnings TTM

37.9

Price / Book TTM

9.5

PEG TTM

4.6

Earnings growth and return

LTM

5YR

10YR

Total return (price & dividends)

39.9 %

56 %

313.5 %

Free cash flow per share growth

13.7 %

45.6 %

85.7 %

Earnings per share growth

8.2 %

78.3 %

125.8 %

Founded: 1,873

Employees: 54,153

Business Summary:Atlas Copco AB, together with its subsidiaries, provides productivity solutions. The company operates through Compressor Technique, Vacuum Technique, Industrial Technique, and Power Technique segments. It offers piston compressors, oil-free tooth and scroll compressors, rotary screw compressors, oil-free blowers, oil-free centrifugal compressors, gas and process compressors, air and gas treatment equipment, and medical air solutions primarily for use in the manufacturing and process industries. The company also provides oil-sealed rotary vane, dry, and liquid ring vacuum pumps; and turbomolecular and cryogenic pumps, as well as abatement and integrated systems for the semiconductor and scientific, chemical process, food packaging, and paper handling industries. In addition, it offers pneumatic, hydraulic, and electric assembly tools, as well as control systems and associated software for safety-critical tightening; self-pierce riveting tools, dispensing equipment for adhesives and sealants, and flow drill fastening equipment; material removal tools, drills, and other pneumatic products; and machine vision solutions for customers in the automotive and general industries. Further, the company provides portable compressors, boosters, generators, lighting towers, pumps, and construction and demolition tools for civil engineering, oil and gas, construction, manufacturing, exploration drilling, and demolition industries, as well as specialty rental services. It operates in North America, South America, Europe, Africa, the Middle East, Asia, and Oceania. The company was founded in 1873 and is headquartered in Nacka, Sweden.

Fair Value Reference Estimate

Latest Earnings Call Takeaways

2026 Q2 (Jul 16, 2026)

1) Strategy & Leadership - Atlas Copco reported a record order intake in Q2 2026, driven by strong growth in the semiconductor market and various industrial segments. - The company continues to focus on its acquisition strategy, having acquired five companies in the quarter, including LACO Technologies, which enhances their leak detection capabilities. - Management emphasized the importance of ramping up production to meet increasing demand, particularly in the semiconductor and industrial compressor sectors.

2) Financial & Segment Results - Orders received increased by over SEK 10 billion year-over-year, with an organic growth rate of 26%. Revenues grew 8% organically. - Adjusted profit increased by 12% year-over-year, with a profit margin of 21%. - Breakdown of organic growth by business area: | Business Area | Organic Growth (%) | |-----------------------|--------------------| | Vacuum Technique | 59 | | Compressor Technique | 19 | | Power Technique | 14 | | Industrial Technique | 11 | - Cash flow remained solid at SEK 6.8 billion, despite increased working capital requirements.

3) Problems / Headwinds - The only negative development was noted in the Middle East, where decision-making has been slow due to regional instability. - Currency headwinds were present, but the impact on the bottom line was expected to be minimal going forward. - The company faces challenges in maintaining competitive lead times in the semiconductor market, necessitating a focus on production ramp-up.

4) Operational or Product Plans - The company is actively increasing production capacity, particularly in the Vacuum Technique segment, to meet high demand. - New product developments are underway, including energy-efficient solutions for the semiconductor market. - The management plans to continue investing in R&D to enhance product offerings and maintain competitive advantages.

5) Guidance & Outlook / Investor Angle - Management expects customer activity to remain elevated in the near term, supported by strong demand in the semiconductor and general industrial markets. - The company is cautious about predicting future order intake in the Gas and Process segment due to its lumpy nature but remains optimistic about the overall order pipeline. - The focus will be on maintaining organic growth while managing margins effectively.

Bottom line: Atlas Copco's strong order intake and revenue growth, particularly in the semiconductor sector, position the company well for continued success. However, investors should be mindful of regional challenges and the need for effective production ramp-up to sustain growth momentum.

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