Article by Yippee-Ki-Yay

Bulten AB Ready to Rally as Earnings Improve and Dividends Rise

Buy signal | Free publication | 29 Apr 2025

Summary of Bulten AB's activities

Bulten AB is a Swedish manufacturer specialising in high-quality fasteners and components for the automotive industry. The company designs, produces and distributes complete fastening solutions primarily for international car manufacturers and their subcontractors.

  • Fastening solutions: screws, nuts, bolts and other specific fasteners for the automotive industry.
  • Logistics management services: value-added services including stock management and just-in-time delivery.
  • Technical solutions: development of customised products and technical advice to optimise fastening systems.

Valuation of Bulten AB

  • Turnover : 4/5 - Steady growth in sales from SEK 3.093 billion in 2019 to SEK 5.807 billion in 2024, with a CAGR of 13.4% over 5 years, demonstrating strong commercial momentum.
  • Net profit : 3,5/5 - Significant growth from SEK 53 million in 2019 to SEK 135 million in 2024, with continued growth forecast to SEK 275 million in 2026.
  • Debt : 3/5 - Net debt of SEK 1.384 billion in 2024 (Cash - Total debt) with a debt/EBITDA ratio of around 2.8x. Expected reduction in net debt to SEK 499 million in 2026.
  • Return on equity (ROE) : 4/5 - ROE 2024: 6.7%, rising to 9.9% in 2025 and 12.2% in 2026 according to forecasts, above the average for the manufacturing sector.
  • Market performance : 3,5/5 - Current PE of 9.05x versus a forecast of 5.91x (attractive valuation) and dividend growth: SEK 2.75 in 2024 to SEK 3.5 in 2026.

Average : 3,6/5 - Bulten AB has a solid financial profile, with stable sales growth, improved profitability and a positive outlook. Debt remains a concern, but the trend is to reduce it.

Forecasts for the coming years

  • 2025 : Sales: SEK 5.931 billion (+2.1% vs 2024), Net profit: SEK 206 million (+52.6% vs 2024), EPS: SEK 9.84 (+53% vs 2024), Dividend per share: SEK 3.25 (+18.2% vs 2024).
  • 2026 : Sales: SEK 6.169 billion (+4% vs 2025), Net profit: SEK 275 million (+33.5% vs 2025), EPS: SEK 13.14 (+33.5% vs 2025), Dividend per share: SEK 3.5 (+7.7% vs 2025).

Estimated share value

For 2025, with a forecast EPS of SEK 9.84 and an average PE for the sector of around 7x, the estimated value of the share could reach SEK 68.88. For 2026, with a forecast EPS of SEK 13.14, the estimated value could rise to SEK 91.98.

Summary

Bulten AB stands out for its stable growth and prospects for improved profitability. The company offers significant upside potential, with a policy of increasing dividends, despite a level of debt that needs to be monitored.

  • Signal : Buy
  • Budget/Investment : Moderate
  • Reinforcement required : No
  • Exposure : Medium
  • Horizon : 2 to 3 years
  • Potential profitability : +35% à +83%
  • Ref. ISIN code : SE0003849223