OM:SAND

Stock Analysis Report

Executive Summary

Sandvik AB (publ) operates as an engineering company in the areas of mining and rock excavation, metal cutting, and materials technology worldwide.

Rewards

Trading at 29.7% below its fair value

Earnings are forecast to grow 10.88% per year

Risk Analysis

Has a high level of debt

Unstable dividend track record

Profit margins (11.4%) are lower than last year (17.2%)



Snowflake Analysis

Excellent balance sheet average dividend payer.


Similar Companies

Share Price & News

How has Sandvik's share price performed over time and what events caused price changes?


Latest Share Price and Events

Stable Share Price: SAND has not had significant price volatility in the past 3 months.


Market Performance


7 Day Return

5.9%

SAND

2.6%

SE Machinery

1.9%

SE Market


1 Year Return

41.8%

SAND

45.1%

SE Machinery

24.0%

SE Market

Return vs Industry: SAND underperformed the Swedish Machinery industry which returned 45.1% over the past year.

Return vs Market: SAND exceeded the Swedish Market which returned 24% over the past year.


Shareholder returns

SANDIndustryMarket
7 Day5.9%2.6%1.9%
30 Day-0.3%0.4%-0.04%
90 Day15.4%13.8%7.8%
1 Year45.3%41.8%50.2%45.1%29.2%24.0%
3 Year68.3%57.4%57.4%31.2%34.2%13.6%
5 Year173.1%139.6%123.2%74.6%63.5%28.3%

Price Volatility Vs. Market

How volatile is Sandvik's share price compared to the market and industry in the last 5 years?


Simply Wall St News

Valuation

Is Sandvik undervalued compared to its fair value and its price relative to the market?

29.7%

Undervalued compared to fair value


Share Price vs. Fair Value

Below Fair Value: SAND (SEK179) is trading below our estimate of fair value (SEK254.75)

Significantly Below Fair Value: SAND is trading below fair value by more than 20%.


Price To Earnings Ratio

PE vs Industry: SAND is poor value based on its PE Ratio (19.2x) compared to the Machinery industry average (17.1x).

PE vs Market: SAND is poor value based on its PE Ratio (19.2x) compared to the Swedish market (18.7x).


Price to Earnings Growth Ratio

PEG Ratio: SAND is poor value based on its PEG Ratio (1.8x)


Price to Book Ratio

PB vs Industry: SAND is overvalued based on its PB Ratio (3.6x) compared to the SE Machinery industry average (2.9x).


Next Steps

Future Growth

How is Sandvik forecast to perform in the next 1 to 3 years based on estimates from 21 analysts?

10.9%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: SAND's forecast earnings growth (10.9% per year) is above the savings rate (-0.4%).

Earnings vs Market: SAND's earnings (10.9% per year) are forecast to grow faster than the Swedish market (9.4% per year).

High Growth Earnings: SAND's earnings are forecast to grow, but not significantly.

Revenue vs Market: SAND's revenue (2.5% per year) is forecast to grow slower than the Swedish market (4.4% per year).

High Growth Revenue: SAND's revenue (2.5% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: SAND's Return on Equity is forecast to be low in 3 years time (19.6%).


Next Steps

Past Performance

How has Sandvik performed over the past 5 years?

27.0%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: SAND has high quality earnings.

Growing Profit Margin: SAND's current net profit margins (11.4%) are lower than last year (17.2%).


Past Earnings Growth Analysis

Earnings Trend: SAND's earnings have grown significantly by 27% per year over the past 5 years.

Accelerating Growth: SAND's has had negative earnings growth over the past year, so it can't be compared to its 5-year average.

Earnings vs Industry: SAND had negative earnings growth (-30.6%) over the past year, making it difficult to compare to the Machinery industry average (11.8%).


Return on Equity

High ROE: SAND's Return on Equity (18.5%) is considered low.


Return on Assets


Return on Capital Employed


Next Steps

Financial Health

How is Sandvik's financial position?


Financial Position Analysis

Short Term Liabilities: SAND's short term assets (SEK64.0B) exceed its short term liabilities (SEK30.3B).

Long Term Liabilities: SAND's short term assets (SEK64.0B) exceed its long term liabilities (SEK31.6B).


Debt to Equity History and Analysis

Debt Level: SAND's debt to equity ratio (47.6%) is considered high.

Reducing Debt: SAND's debt to equity ratio has reduced from 128.3% to 47.6% over the past 5 years.

Debt Coverage: SAND's debt is well covered by operating cash flow (59.2%).

Interest Coverage: SAND's interest payments on its debt are well covered by EBIT (13.8x coverage).


Balance Sheet

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

Debt Coverage by Assets: SAND's debt is covered by short term assets (assets are 2.1x debt).


Next Steps

Dividend

What is Sandvik's current dividend yield, its reliability and sustainability?

2.37%

Current Dividend Yield


Dividend Yield vs Market

company2.4%marketbottom25%1.6%markettop25%4.7%industryaverage2.4%forecastin3Years2.8%

Current dividend yield vs market & industry

Notable Dividend: SAND's dividend (2.37%) is higher than the bottom 25% of dividend payers in the Swedish market (1.61%).

High Dividend: SAND's dividend (2.37%) is low compared to the top 25% of dividend payers in the Swedish market (4.75%).


Stability and Growth of Payments

Stable Dividend: SAND's dividend payments have been volatile in the past 10 years.

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


Current Payout to Shareholders

Dividend Coverage: With its reasonably low payout ratio (45.7%), SAND's dividend payments are well covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: SAND's dividends in 3 years are forecast to be well covered by earnings (44.3% payout ratio).


Next Steps

Management

What is the CEO of Sandvik's salary, the management and board of directors tenure and is there insider trading?

5.1yrs

Average management tenure


CEO

Björn Klas Rosengren (60yo)

4.1yrs

Tenure

kr38,564,788

Compensation

Mr. Björn Klas Otto Rosengren, M.Sc. (Tech.), has been the Chief Executive Officer and President at Sandvik AB since November 1, 2015. Mr. Rosengren served as the Chief Executive Officer, President and a M ...


CEO Compensation Analysis

Compensation vs Market: Björn Klas's total compensation ($USD4.06M) is above average for companies of similar size in the Swedish market ($USD1.82M).

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


Management Age and Tenure

5.1yrs

Average Tenure

50yo

Average Age

Experienced Management: SAND's management team is seasoned and experienced (5.1 years average tenure).


Board Age and Tenure

4.6yrs

Average Tenure

60yo

Average Age

Experienced Board: SAND's board of directors are considered experienced (4.6 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.


Recent Insider Transactions

Buykr208,936,52028 Nov 19
AB Industrivärden (publ)
EntityCompany
Shares1,200,000
Max Pricekr175.25
Buykr1,360,00012 Aug 19
Björn Klas Rosengren
EntityIndividual
Role
Chief Executive Officer
President
Shares10,000
Max Pricekr136.00
Buykr1,509,90014 Jun 19
Björn Klas Rosengren
EntityIndividual
Role
Chief Executive Officer
President
Shares9,425.33
Max Pricekr160.20
Buykr350,00013 Jun 19
Åsa Maria Thunman
EntityIndividual
Role
Chief Legal Officer
Executive VP
Shares2,184.82
Max Pricekr160.20
Buykr504,93813 Jun 19
Tomas Eliasson
EntityIndividual
Role
Chief Financial Officer
Executive VP & CFO
Shares3,152
Max Pricekr160.20
Buykr375,00013 Jun 19
Göran Björkman
EntityIndividual
Shares2,340.88
Max Pricekr160.20
Buykr261,99913 Jun 19
Johan Kerstell
EntityIndividual
Role
Head of Human Resources
Executive VP & Head of Human Resources
Shares1,635.49
Max Pricekr160.20
Buykr149,08513 Jun 19
Jessica Alm
EntityIndividual
Role
Head of Corporate Communications
Executive VP & Head of Group Communications
Shares930.64
Max Pricekr160.20
Sellkr2,822,20224 May 19
Johan Kerstell
EntityIndividual
Role
Head of Human Resources
Executive VP & Head of Human Resources
Shares17,421
Max Pricekr162.00
Buykr1,532,20023 May 19
Björn Klas Rosengren
EntityIndividual
Role
Chief Executive Officer
President
Shares10,000
Max Pricekr153.22
Sellkr951,20323 May 19
Klas Forsström
EntityIndividual
Shares5,889.8
Max Pricekr161.50
Sellkr1,339,18116 May 19
Jessica Alm
EntityIndividual
Role
Head of Corporate Communications
Executive VP & Head of Group Communications
Shares8,305
Max Pricekr161.25
Buykr148,34015 May 19
Björn Klas Rosengren
EntityIndividual
Role
Chief Executive Officer
President
Shares929.89
Max Pricekr159.53
Buykr26,84315 May 19
Göran Björkman
EntityIndividual
Shares168.27
Max Pricekr159.53
Buykr48,77915 May 19
Jessica Alm
EntityIndividual
Role
Head of Corporate Communications
Executive VP & Head of Group Communications
Shares305.78
Max Pricekr159.53
Buykr34,92815 May 19
Åsa Maria Thunman
EntityIndividual
Role
Chief Legal Officer
Executive VP
Shares218.95
Max Pricekr159.53
Buykr47,85615 May 19
Tomas Eliasson
EntityIndividual
Role
Chief Financial Officer
Executive VP & CFO
Shares300
Max Pricekr159.52
Buykr40,89515 May 19
Klas Forsström
EntityIndividual
Shares256.36
Max Pricekr159.52
Buykr23,13115 May 19
Johan Kerstell
EntityIndividual
Role
Head of Human Resources
Executive VP & Head of Human Resources
Shares145
Max Pricekr159.53
Buykr18,903,44410 May 19
Björn Klas Rosengren
EntityIndividual
Role
Chief Executive Officer
President
Shares112,554
Max Pricekr167.95
Sellkr21,441,50110 May 19
Björn Klas Rosengren
EntityIndividual
Role
Chief Executive Officer
President
Shares128,631
Max Pricekr166.69
Sellkr2,761,75210 May 19
Göran Björkman
EntityIndividual
Shares16,681.7
Max Pricekr165.56
Sellkr3,805,71709 May 19
Klas Forsström
EntityIndividual
Shares23,044
Max Pricekr165.15
Buykr3,217,08209 May 19
Klas Forsström
EntityIndividual
Shares19,155
Max Pricekr167.95
Buykr3,976,30408 May 19
Åsa Maria Thunman
EntityIndividual
Role
Chief Legal Officer
Executive VP
Shares23,675.52
Max Pricekr167.95
Buykr1,325,43508 May 19
Jessica Alm
EntityIndividual
Role
Head of Corporate Communications
Executive VP & Head of Group Communications
Shares7,891.84
Max Pricekr167.95
Buykr6,229,43308 May 19
Tomas Eliasson
EntityIndividual
Role
Chief Financial Officer
Executive VP & CFO
Shares37,091
Max Pricekr167.95
Sellkr7,167,88608 May 19
Tomas Eliasson
EntityIndividual
Role
Chief Financial Officer
Executive VP & CFO
Shares43,137
Max Pricekr166.17
Sellkr4,537,06508 May 19
Åsa Maria Thunman
EntityIndividual
Role
Chief Legal Officer
Executive VP
Shares27,529.68
Max Pricekr164.81
Buykr2,355,48708 May 19
Göran Björkman
EntityIndividual
Shares14,024.93
Max Pricekr167.95
Buykr2,518,24208 May 19
Johan Kerstell
EntityIndividual
Role
Head of Human Resources
Executive VP & Head of Human Resources
Shares14,994
Max Pricekr167.95
Buykr272,500,73329 Jan 19
AB Industrivärden (publ)
EntityCompany
Shares1,900,000
Max Pricekr144.07

Ownership Breakdown

Dilution of Shares: Shareholders have not been meaningfully diluted in the past year.


Management Team

  • Björn Klas Rosengren (60yo)

    President

    • Tenure: 4.1yrs
    • Compensation: kr38.56m
  • Tomas Eliasson (57yo)

    Executive VP & CFO

    • Tenure: 3.7yrs
  • Åsa Maria Thunman (50yo)

    Executive VP

    • Tenure: 5.2yrs
  • Ann-Sofie Nordh (50yo)

    Vice President of Investor Relations

    • Tenure: 0yrs
  • Carl Larsson

    Head of Real Estate

    • Tenure: 0yrs
  • Bernth Nilsson

    Head of Group Staff Assurance

    • Tenure: 10.7yrs
  • Pierre Jansson

    Head of Taxes and Financial Projects

    • Tenure: 10.3yrs
  • Jessica Alm (42yo)

    Executive VP & Head of Group Communications

    • Tenure: 6.4yrs
  • Johan Malmgren

    Chief Information Officer

    • Tenure: 5yrs
  • Johan Kerstell (49yo)

    Executive VP & Head of Human Resources

    • Tenure: 3.5yrs

Board Members

  • Lars Westerberg (71yo)

    Independent Director

    • Tenure: 9.6yrs
    • Compensation: kr930.00k
  • Helena Stjernholm (49yo)

    Director

    • Tenure: 3.7yrs
    • Compensation: kr820.00k
  • Percy Barnevik (78yo)

    Honorary Chairman

    • Tenure: 0yrs
  • Björn Klas Rosengren (60yo)

    President

    • Tenure: 4.1yrs
    • Compensation: kr38.56m
  • Johan Karlström (62yo)

    Independent Director

    • Tenure: 8.6yrs
    • Compensation: kr770.00k
  • Johan Molin (60yo)

    Independent Chairman of the Board

    • Tenure: 4.6yrs
    • Compensation: kr2.54m
  • Jennifer Allerton (68yo)

    Independent Director

    • Tenure: 4.6yrs
    • Compensation: kr660.00k
  • Tomas Kärnström (53yo)

    Employee Representative Director

    • Tenure: 13.6yrs
  • Claes Boustedt (57yo)

    Independent Director

    • Tenure: 4.6yrs
    • Compensation: kr945.00k
  • Thomas Lilja (44yo)

    Employee Representative Director

    • Tenure: 3.9yrs

Company Information

Sandvik AB's company bio, employee growth, exchange listings and data sources


Key Information

  • Name: Sandvik AB
  • Ticker: SAND
  • Exchange: OM
  • Founded: 1862
  • Industry: Industrial Machinery
  • Sector: Capital Goods
  • Market Cap: kr224.535b
  • Shares outstanding: 1.25b
  • Website: https://www.home.sandvik

Number of Employees


Location

  • Sandvik AB
  • World Trade Center
  • floor 6
  • Stockholm
  • Stockholm County
  • 111 22
  • Sweden

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
SDVK.FOTCPK (Pink Sheets LLC)YesOrdinary SharesUSUSDJun 1993
SANDOM (OMX Nordic Exchange Stockholm)YesOrdinary SharesSESEKJun 1993
0HC0LSE (London Stock Exchange)YesOrdinary SharesGBSEKJun 1993
SVKBDB (Deutsche Boerse AG)YesOrdinary SharesDEEURJun 1993
SANDSBATS-CHIXE (BATS 'Chi-X Europe')YesOrdinary SharesGBSEKJun 1993
SDVK.YOTCPK (Pink Sheets LLC)ADRUSUSDAug 1994

Biography

Sandvik AB (publ) operates as an engineering company in the areas of mining and rock excavation, metal cutting, and materials technology worldwide. The company offers metal-cutting tools and tooling system ...


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2019/12/10 21:20
End of Day Share Price2019/12/10 00:00
Earnings2019/09/30
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.