Nordea has raised its recommendation for truck and bus manufacturer Volvo to buy from hold, setting a target price of 360 kronor.
The major bank has also lifted its operating profit forecast for 2026 by 11 percent. Nordea argues that there is still more upside potential, even after the stock's strong performance. This is driven by upgraded forecasts, generous capital distribution, and a revaluation.
"Fundamentals in the truck industry are improving, especially in North America, supported by a stronger economy, higher freight rates, and EPA 2027 regulations that create conditions for pre-buying in 2026. We believe Volvo is well positioned to benefit from stronger industry prospects and expect earnings growth of 12 percent for 2026," the bank stated.
AB Volvo is the leading European truck maker and No. 3 worldwide. Net sales break down by activity as follows:
- sales of trucks (68.4%): 219,377 vehicles sold in 2024 (names Volvo, Renault, Eicher and Mack);
- sales of construction equipment (16.8%): excavators, loaders, backhoes, hydraulic shovels, graders, dump trucks, etc.;
- financial services (5.1%);
- bus and chassis sales (4.7%): world's No. 2 largest manufacturer;
- sales of parts, control systems, and marine and industrial motors (3.8%): for commerce and cruise ships and for industrial applications (irrigation units, lifting trucks, electrical generators, etc.);
- other (1.2%).
Net sales are distributed geographically as follows: Europe (41.1%), North America (30.8%), Asia (11.2%), South America (10.7%), Africa and Oceania (6.2%).
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