HLSE:UPM

Stock Analysis Report

Executive Summary

UPM-Kymmene Oyj operates in the forest-based bio industry.

Snowflake

Fundamentals

Flawless balance sheet with solid track record and pays a dividend.


Similar Companies

Share Price & News

How has UPM-Kymmene Oyj's share price performed over time and what events caused price changes?


Latest Share Price and Events


Market Performance


7 Day Return

3.6%

UPM

4.4%

FI Forestry

2.4%

FI Market


1 Year Return

-7.9%

UPM

-11.5%

FI Forestry

3.7%

FI Market

Return vs Industry: UPM exceeded the Finnish Forestry industry which returned -11.5% over the past year.

Return vs Market: UPM underperformed the Finnish Market which returned 3.7% over the past year.


Shareholder returns

UPMIndustryMarket
7 Day3.6%4.4%2.4%
30 Day3.4%1.0%-0.2%
90 Day28.3%13.0%3.0%
1 Year-3.4%-7.9%-7.4%-11.5%8.4%3.7%
3 Year65.4%45.5%50.9%0.2%28.8%13.5%
5 Year213.4%152.1%131.5%46.9%62.3%31.2%

Price Volatility Vs. Market

How volatile is UPM-Kymmene Oyj's share price compared to the market and industry in the last 5 years?


Simply Wall St News

Valuation

Is UPM-Kymmene Oyj undervalued compared to its fair value and its price relative to the market?

41.7%

Undervalued compared to fair value


Share Price vs. Fair Value

Undervalued: UPM (€28.01) is trading below our estimate of fair value (€48.02)

Significantly Undervalued: UPM is trading below fair value by more than 20%.


Price To Earnings Ratio

PE vs Industry: UPM is good value based on its PE Ratio (10.2x) compared to the Forestry industry average (10.4x).

PE vs Market: UPM is good value based on its PE Ratio (10.2x) compared to the Finnish market (20.2x).


Price to Earnings Growth Ratio

Low PEG Ratio: UPM's earnings are forecast to decline next year, so we can't calculate its PEG ratio.


Price to Book Ratio

PB vs Industry: UPM is overvalued based on its PB Ratio (1.6x) compared to the XE Forestry industry average (1.2x).


Next Steps

Future Growth

How is UPM-Kymmene Oyj forecast to perform in the next 1 to 3 years based on estimates from 12 analysts?

-2.0%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: UPM's earnings are forecast to decline over the next 3 years (-2% per year).

Earnings vs Market: UPM's earnings are forecast to decline over the next 3 years (-2% per year).

High Growth Earnings: UPM's earnings are forecast to decline over the next 3 years.

Revenue vs Market: UPM's revenue (1.5% per year) is forecast to grow slower than the Finnish market (2.1% per year).

High Growth Revenue: UPM's revenue (1.5% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

High Future ROE: UPM's Return on Equity is forecast to be low in 3 years time (10.2%).


Next Steps

Past Performance

How has UPM-Kymmene Oyj performed over the past 5 years?

20.1%

Historical annual earnings growth


Earnings and Revenue History


Past Earnings Growth Analysis

Earnings Trend: UPM's earnings have grown significantly by 20.1% per year over the past 5 years.

Accelerating Growth: UPM's earnings growth over the past year (32.6%) exceeds its 5-year average (20.1% per year).

Earnings vs Industry: UPM earnings growth over the past year (32.6%) exceeded the Forestry industry 1.2%.


Return on Equity

High ROE: UPM's Return on Equity (15.4%) is considered low.


Return on Assets

ROA vs Industry: UPM has a higher Return on Assets than the Forestry industry average last year.


Return on Capital Employed

ROCE Improving: UPM has significantly improved its Return on Capital Employed over the past 3 years.


Next Steps

Financial Health

How is UPM-Kymmene Oyj's financial position?


Financial Position Analysis

Short Term Liabilities: UPM's short term assets (€4.2B) exceeds its short term liabilities (€1.9B)

Long Term Liabilities: UPM's short term assets (4.2B) exceeds its long term liabilities (2.6B)


Debt to Equity History and Analysis

Debt Level: UPM's debt to equity ratio (12.2%) is considered satisfactory

Reducing Debt: UPM's debt to equity ratio has reduced from 51.8% to 12.2% over the past 5 years.

Debt Coverage: UPM's debt is well covered by operating cash flow (137.3%).

Interest Coverage: UPM's interest payments on its debt are well covered by EBIT (68x coverage).


Balance Sheet

Inventory Level: UPM has a high level of physical assets or inventory.

Debt Coverage by Assets: UPM's debt is covered by short term assets (assets are 3.555170x debt).


Next Steps

Dividend

What is UPM-Kymmene Oyj's current dividend yield, its reliability and sustainability?

4.64%

Current Dividend Yield


Dividend Yield vs Market

company4.6%marketbottom25%2.2%markettop25%5.1%industryaverage4.4%forecastin3Years5.1%

Current dividend yield vs market & industry


Stability and Growth of Payments

Notable Dividend: UPM's dividend (4.64%) is higher than the bottom 25% of dividend payers in the Finnish market (2.25%).

High Dividend: UPM's dividend (4.64%) is low compared to the top 25% of dividend payers in the Finnish market (5.08%).

Stable Dividend: UPM's dividends per share have been stable in the past 10 years.

Growing Dividend: UPM's dividend payments have increased over the past 10 years.


Current Payout to Shareholders

Dividend Coverage: With its reasonably low payout ratio (47.3%), UPM's dividend payments are well covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: UPM's dividends in 3 years are forecast to be covered by earnings (74.5% payout ratio).


Next Steps

Management

What is the CEO of UPM-Kymmene Oyj's salary, the management and board of directors tenure and is there insider trading?

10.6yrs

Average management tenure


CEO

Jussi Pesonen (59yo)

15.8yrs

Tenure

€5,978,000

Compensation

Mr. Jussi Pesonen, M.Sc. (Eng.), has been Chief Executive Officer and President of UPM-Kymmene Oyj since January 29, 2004 and has been its Head of UPM Biorefining since November 2018. Mr. Pesonen serves as ...


CEO Compensation Analysis

Compensation vs. Market: Jussi's total compensation ($USD6.61M) is about average for companies of similar size in the Finnish market ($USD497.86K).

Compensation vs Earnings: Jussi's compensation has been consistent with company performance over the past year.


Management Age and Tenure

10.6yrs

Average Tenure

56.5yo

Average Age

Experienced Management: UPM's management team is seasoned and experienced (10.6 years average tenure).


Board Age and Tenure

7.0yrs

Average Tenure

60yo

Average Age

Experienced Board: UPM's board of directors are considered experienced (7 years average tenure).


Insider Trading

Insider Buying: Insufficient data to determine if insiders have bought more shares than they have sold in the past 3 months.


Ownership Breakdown


Management Team

  • Jussi Pesonen (59yo)

    President

    • Tenure: 15.8yrs
    • Compensation: €5.98m
  • Jyrki Ovaska (61yo)

    Executive Vice President of Technology

    • Tenure: 5.9yrs
  • Pirkko Harrela (59yo)

    Executive Vice President of Stakeholder Relations

    • Tenure: 5.9yrs
  • Riitta Savonlahti (55yo)

    Executive Vice President of Human Resources

    • Tenure: 15.4yrs
  • Juha Mäkelä (57yo)

    General Counsel

    • Tenure: 14.4yrs
  • Bernd Eikens (54yo)

    Executive Vice President of UPM Biorefining

    • Tenure: 11.8yrs
  • Tapio Korpeinen (56yo)

    CFO & Executive VP of UPM Energy

    • Tenure: 9.4yrs
  • Anu Ahola (54yo)

    Senior Vice President of SBU Newspaper Publishing for UPM Paper Europe & North America

    • Tenure: 11.8yrs
  • Mika Mikkola

    Vice President of Investor Relations

    • Tenure: 8.2yrs
  • Hanna Maula

    Vice President of Communications & Brand

    • Tenure: 0.2yrs

Board Members

  • Kim Wahl (59yo)

    Independent Director

    • Tenure: 7.6yrs
    • Compensation: €125.00k
  • Berndt Brunow (69yo)

    Deputy Chairman

    • Tenure: 14.8yrs
    • Compensation: €145.00k
  • Jussi Pesonen (59yo)

    President

    • Tenure: 15.8yrs
    • Compensation: €5.98m
  • Björn Wahlroos (67yo)

    Independent Chairman

    • Tenure: 11.6yrs
    • Compensation: €210.00k
  • Veli-Matti Reinikkala (62yo)

    Independent Director

    • Tenure: 12.6yrs
    • Compensation: €130.00k
  • Ari Puheloinen (68yo)

    Independent Director

    • Tenure: 5.2yrs
    • Compensation: €120.00k
  • Henrik Ehrnrooth (50yo)

    Independent Director

    • Tenure: 4.5yrs
    • Compensation: €120.00k
  • Suzanne Thoma (57yo)

    Independent Director

    • Tenure: 4.5yrs
    • Compensation: €120.00k
  • Piia-Noora Kauppi (44yo)

    Independent Director

    • Tenure: 6.5yrs
    • Compensation: €145.00k
  • Marjan Oudeman (61yo)

    Independent Director

    • Tenure: 1.5yrs
    • Compensation: €125.00k

Company Information

UPM-Kymmene Oyj's company bio, employee growth, exchange listings and data sources


Key Information

  • Name: UPM-Kymmene Oyj
  • Ticker: UPM
  • Exchange: HLSE
  • Founded: 1995
  • Industry: Paper Products
  • Sector: Materials
  • Market Cap: €14.938b
  • Shares outstanding: 533.32m
  • Website: https://www.upm.com

Number of Employees


Location

  • UPM-Kymmene Oyj
  • Alvar Aallon katu 1
  • Helsinki
  • Uusimaa
  • 101
  • Finland

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
UPMK.FOTCPK (Pink Sheets LLC)YesOrdinary SharesUSUSDMay 1996
RPLDB (Deutsche Boerse AG)YesOrdinary SharesDEEURMay 1996
UPMHLSE (OMX Nordic Exchange Helsinki)YesOrdinary SharesFIEURMay 1996
0NV5LSE (London Stock Exchange)YesOrdinary SharesGBEURMay 1996
UPM NBMV (Bolsa Mexicana de Valores)YesOrdinary SharesMXMXNMay 1996
UPMM.YOTCPK (Pink Sheets LLC)UNSPONSORED ADSUSUSDAug 2019

Biography

UPM-Kymmene Oyj operates in the forest-based bio industry. It operates through UPM Biorefining, UPM Energy, UPM Raflatac, UPM Specialty Papers, UPM Communication Papers, UPM Plywood, and Other operations s ...


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2019/10/16 20:40
End of Day Share Price2019/10/16 00:00
Earnings2019/06/30
Annual Earnings2018/12/31


Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.