Last Update 22 Mar 26

SECU B: Future Dividend Policy And Execution On Margin And P/E Will Matter

Narrative Update on Securitas

Analysts have lifted their average price targets for Securitas into the low SEK 120s, with one move from SEK 114 to SEK 122 and another SEK 10 increase, while only marginally adjusting assumptions for the discount rate, revenue growth, profit margin and future P/E. This reflects a more refined yet still cautious view on the shares.

Analyst Commentary

Recent research on Securitas has centered on price target revisions in the SEK 120 range and at least one rating downgrade, giving you a mix of cautious and more constructive views to weigh.

Bullish Takeaways

Bullish analysts lifting price targets toward the low SEK 120s see room for value if Securitas can meet their assumptions on revenue, margin and future P/E, even if those assumptions have only been adjusted marginally.
The move to SEK 122 outlined by Morgan Stanley points to a view that current trading levels leave some upside potential relative to their refined assessment of earnings power and risk.
Incremental price target increases of around SEK 10 suggest that small tweaks to models, rather than major changes in outlook, are enough for some analysts to see the shares as closer to fair value on their numbers.
Where targets are raised without big changes to discount rates or growth assumptions, it implies that execution on existing plans, rather than a new growth story, is the key swing factor for these more optimistic forecasts.

Bearish Takeaways

The presence of an Underweight rating alongside a higher price target underlines that some bearish analysts still see better risk or reward elsewhere, even after acknowledging improved valuation support.
The downgrade from another firm signals that parts of the market are more focused on execution risks and the ability to reach modeled margins and earnings, rather than on the headline increase in target prices.
Conservative changes to assumptions for growth, profitability and future P/E point to limited confidence that Securitas can move meaningfully beyond current expectations without proving consistent delivery.
The mix of raised targets with cautious or negative ratings leaves a picture where analysts accept the current valuation as more refined, but remain hesitant to back stronger growth or re rating potential without clearer evidence.

What's in the News

Securitas AB (publ) proposed a dividend for 2025 of SEK 5.30 per share, compared with SEK 4.50 per share, to be paid in two equal installments for the January to December 2025 period (Key Developments).

Valuation Changes

Fair Value: SEK 155.40 is unchanged, indicating no shift in the central valuation estimate used in the model.
Discount Rate: Now 5.78%, adjusted slightly from 5.78%, reflecting only a minimal change in the required return assumption.
Revenue Growth: Held steady at 80.50%, with the updated figure staying effectively in line with the previous assumption.
Net Profit Margin: Remains around 5.13%, with the updated margin essentially matching the earlier input.
Future P/E: Now 12.90x, fractionally revised from 12.90x, suggesting no meaningful change in the valuation multiple applied to future earnings.

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Key Takeaways

Shifting focus to technology-driven, higher-margin contracts and advanced security services is expected to boost revenue growth, margins, and profitability.
Streamlining operations, closing low-margin contracts, and ongoing cost-cutting initiatives are improving cash flow, balance sheet strength, and overall efficiency.
Portfolio risk from business exits, underperformance in key growth areas, and integration challenges threaten margin expansion and stable revenue amid evolving market and operational pressures.

Catalysts

About Securitas

Provides security services in North America, Europe, Latin America, Africa, the Middle East, Asia, and Australia.What are the underlying business or industry changes driving this perspective?

Securitas is capitalizing on rising urbanization and increasing global wealth by focusing investments into technology and data-driven security solutions, positioning itself to capture premium, higher-margin contracts in a growing addressable market, which should drive sustained revenue and margin expansion.
Growing frequency and sophistication of security threats are leading corporate clients to invest more in advanced and integrated security services; Securitas' strategic pivot toward higher-value Technology & Solutions offerings positions it well to benefit from this demand, supporting topline growth and improved profitability.
The closure of low-margin, working-capital intensive government contracts and ongoing active portfolio management are expected to sharpen Securitas' focus and yield substantial improvements in operating margins and cash flow over the next 18–24 months.
The company's European transformation and business optimization programs are on track to deliver substantial cost savings (SEK 200 million by year-end), with AI
and digital initiatives providing meaningful operating leverage, which will bolster net income and margin expansion.
Deleveraging and improved working capital management have strengthened the balance sheet and reduced interest costs, while continued repurposing of capital toward scalable, tech-enabled services should increase returns on capital and drive higher earnings per share.

Securitas Future Earnings and Revenue Growth

Assumptions

How have these above catalysts been quantified?

Analysts are assuming Securitas's revenue will remain fairly flat over the next 3 years.
Analysts assume that profit margins will increase from 3.3% today to 5.1% in 3 years time.
Analysts expect earnings to reach SEK 8.2 billion (and earnings per share of SEK 14.14) by about March 2029, up from SEK 5.1 billion today. The analysts are largely in agreement about this estimate.
In order for the above numbers to justify the price target of the analysts, the company would need to trade at a PE ratio of 12.9x on those 2029 earnings, down from 16.5x today. This future PE is lower than the current PE for the GB Commercial Services industry at 17.5x.
Analysts expect the number of shares outstanding to remain consistent over the next 3 years.
To value all of this in today's terms, we will use a discount rate of 5.78%, as per the Simply Wall St company report.

Risks

What could happen that would invalidate this narrative?

The closure of the SCIS government business, accounting for a significant portion of group revenue, highlights Securitas' ongoing exposure to contract and portfolio risk; if similar strategic exits or divestitures are needed in the future, this could lead to episodic revenue declines or restructuring costs, negatively impacting total revenue and potentially delaying consistent margin improvement.
The Technology & Solutions segment, considered a key growth and margin driver, has recently underperformed expectations, particularly in the U.S.; if Securitas cannot accelerate growth and commercial momentum in this higher-value segment or faces ongoing operational challenges in its "go-to-market" approach, the anticipated boost to overall company revenue and net margins may be less than forecast.
Securitas' business optimization and digital transformation initiatives, including cost savings driven by AI and digital tools, have a defined scope and timeline; if longer-term labor cost inflation, pressure on local service delivery, or slower-than-expected adoption of automation outpaces these internal efficiency gains, net profit margin expansion could be constrained in a labor-intensive sector.
Persistent macroeconomic uncertainty and shifting client priorities, such as budget cuts or reallocations from physical to digital security amid evolving security threats, could reduce demand for traditional and hybrid security services, resulting in lower contract volumes and top-line revenue.
Execution risk remains elevated following recent large acquisitions and ongoing portfolio reshaping (e.g., STANLEY, SCIS closure); if Securitas faces integration challenges, fails to fully realize anticipated synergies, or incurs further one-off charges, both near-term earnings and long-term sustainable profitability could be negatively affected.

Valuation

How have all the factors above been brought together to estimate a fair value?

The analysts have a consensus price target of SEK155.4 for Securitas based on their expectations of its future earnings growth, profit margins and other risk factors.
However, there is a degree of disagreement amongst analysts, with the most bullish reporting a price target of SEK180.0, and the most bearish reporting a price target of just SEK122.0.
In order for you to agree with the analysts, you'd need to believe that by 2029, revenues will be SEK158.9 billion, earnings will come to SEK8.2 billion, and it would be trading on a PE ratio of 12.9x, assuming you use a discount rate of 5.8%.
Given the current share price of SEK147.65, the analyst price target of SEK155.4 is 5.0% higher. The relatively low difference between the current share price and the analyst consensus price target indicates that they believe on average, the company is fairly priced.
We always encourage you to reach your own conclusions though. So sense check these analyst numbers against your own assumptions and expectations based on your understanding of the business and what you believe is probable.

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Disclaimer

AnalystConsensusTarget is a tool utilizing a Large Language Model (LLM) that ingests data on consensus price targets, forecasted revenue and earnings figures, as well as the transcripts of earnings calls to produce qualitative analysis. The narratives produced by AnalystConsensusTarget are general in nature and are based solely on analyst data and publicly-available material published by the respective companies. These scenarios are not indicative of the company's future performance and are exploratory in nature. Simply Wall St has no position in the company(s) mentioned. Simply Wall St may provide the securities issuer or related entities with website advertising services for a fee, on an arm's length basis. These relationships have no impact on the way we conduct our business, the content we host, or how our content is served to users. The price targets and estimates used are consensus data, and do not constitute a recommendation to buy or sell any stock, and they do not take account of your objectives, or your financial situation. Note that AnalystConsensusTarget's analysis may not factor in the latest price-sensitive company announcements or qualitative material.

Analysts Marginally Lower Securitas Price Target as Revenue Outlook Weakens Ahead of Investor Day