One-glance verdict
Within fair range
$33.26 our estimate vs market $28.37
Wall Street consensus: $23.50 (-29.3% lower than our fair-value estimate)
15% below our estimate
Fundamentals snapshot
AB SKF (publ)
SKFRY · PNK · Industrials · Tools & Accessories
Current price
$28.37
52-week range
$22.26 - $29.42
Market cap
$12.92B
Balance sheet
Watch
7.63x Adequate
Net cash $0.00. Interest coverage shows how many times profit covers the interest bill.
What stands out
3 Rewards
3 Risks
3 rewards · 3 risks
- Reward Returns 9.8% on equity, ahead of 50% of its peers.
- Reward Free cash flow was positive in 4/10 years.
- Risk Stock trades 1015.0% above its 5-year average P/E.
- Risk Operating margin compressed from 9.7% to 0.0% over 3 years.
What this company does
AB SKF (publ)
SKF makes and sells bearings, which are crucial parts in many machines, and related services like maintenance and lubrication systems. Their money mostly comes from selling these products and services to big industries like manufacturing, automotive, and renewable energy. This is important because their products help keep other businesses running smoothly and efficiently.
How the company got here
SKF, which stands for "Svenska Kullagerfabriken" or "Swedish Ball Bearing Factory," was founded in 1907 in Gothenburg, Sweden. Its origin story is rooted in solving a practical problem: buildings in Gothenburg were sinking into the soft ground, causing machinery to misalign. Engineer Sven Wingquist invented a revolutionary self-aligning ball bearing in 1907 that could accommodate this misalignment, laying the foundation for the company. Early success led to rapid global expansion, with manufacturing facilities established in multiple countries by the 1930s. SKF even briefly ventured into the automotive manufacturing business, founding Volvo in 1927, though it later divested its stake in the car company to focus on its core bearing business. Over the decades, SKF has grown through strategic acquisitions, expanding its product portfolio to include seals, lubrication systems, and condition monitoring solutions, solidifying its position as a global leader in rotating equipment solutions.
What it actually does
At its core, SKF designs, manufactures, and sells a wide array of products that help keep machines and vehicles running smoothly. Think of the bearings in your car's wheels or the ones that allow a washing machine's drum to spin – SKF makes these essential components. Beyond just bearings, they also produce seals to prevent leaks, systems to automatically lubricate machinery, and tools to monitor the health of equipment, all aimed at reducing friction and wear, which in turn saves energy and extends the life of machines.
Bearing Solutions
This is SKF's largest business segment and forms the historical core of the company. It encompasses a vast range of bearings, from standard ball and roller bearings used in countless industrial applications to highly specialized bearings for demanding environments like aerospace. These bearings are critical components that reduce friction and enable smooth rotation in everything from heavy machinery in factories to precision instruments. The segment also includes bearing units, which are pre-assembled bearings and housings, making them easier to install and maintain for customers across various industries.
Specialized Industrial Solutions (SIS)
This segment is a collection of SKF's more specialized businesses, designed to offer unique solutions beyond traditional bearings. It includes four key areas: Aerospace, which provides critical components for aircraft engines and systems; Lubrication Lifetime Solutions, offering automatic and manual systems to ensure machinery is properly lubricated, reducing wear and tear; Sealing Solutions, which develops advanced seals for industrial applications to prevent contamination and leakage; and Magnetic Solutions, which uses magnetic levitation technology to create virtually friction-free environments for highly specialized applications. These businesses often cater to niche markets with high-performance requirements.
Automotive (Planned Separation)
SKF's Automotive segment develops and produces bearings, seals, and related products specifically for vehicles, including those used in electric powertrains, engines, and suspension systems. This business has been a significant part of SKF, but the company is in the process of separating it to become a standalone entity, likely to be named SKF Vertevo. The goal of this separation is to allow both the industrial and automotive businesses to focus more clearly on their distinct markets and strategies, potentially unlocking further growth and competitiveness for each. The automotive business is expected to be listed as a separate company in late 2026.
What management is betting on now
SKF's current strategy revolves around leveraging its expertise in friction reduction and rotating equipment to drive sustainable value. A key focus is the ongoing separation of its Automotive business, which management believes will allow both the industrial and automotive divisions to thrive independently with tailored strategies. SKF is also emphasizing innovation in areas like condition monitoring and lubrication systems, aiming to provide solutions that not only improve machine performance but also reduce energy consumption and environmental impact. The company is investing in advanced technologies and services to support its customers in achieving greater efficiency and reliability.
Price history
How the share price has moved
—
Loading price history…
Is it cheap or expensive?
Fair value $33.26 vs current price $28.37
Wall Street consensus is the average analyst price target: $23.50 (-29.3% lower than our fair-value estimate).
Our most-likely fair value is $33.26 a share — about 17.2% away from today's price of $28.37, so the stock currently looks fairly priced.
Is it drowning in debt?
Watch
Net cash $0 - more cash than debt. Interest coverage 7.6x.
Net debt
$0.00
Interest coverage
7.63x
AB SKF (publ)'s profit covers its interest bill about 7.6 times over. which is stronger than most peers shown here.
Watch
Worse cushion
Baseline
Better cushion
SKFRY
BASELINE
AB SKF (publ)
Total debt — Interest coverage 7.63x This is the baseline the peer rows are being compared against.
Total debt $2.20B Interest coverage 5.13x -33% vs SKFRY Carries about 1.5x less debt cushion than SKFRY.
Total debt $878.10M Interest coverage 8.67x +14% vs SKFRY Has roughly the same debt cushion as SKFRY.
Total debt $8.73B Interest coverage 11.56x +52% vs SKFRY Carries about 1.5x more debt cushion than SKFRY.
Total debt $9.37B Interest coverage 14.44x +89% vs SKFRY Carries about 1.9x more debt cushion than SKFRY.
Total debt $4.77B Interest coverage 1.96x -74% vs SKFRY Carries about 3.9x less debt cushion than SKFRY.
What you should know
The case for and against SKFRY
3 Rewards
3 Risks
Rewards
-
Returns 9.8% on equity, ahead of 50% of its peers.
-
Free cash flow was positive in 4/10 years.
-
Trades at 20.6x P/E vs peer median 32.6x (36.9% cheaper).
Risks
-
Stock trades 1015.0% above its 5-year average P/E.
-
Operating margin compressed from 9.7% to 0.0% over 3 years.
-
Insider ownership is only 0.0% (peer median: 0.5%).
The numbers
All the key metrics, grouped by purpose
Tap any ? icon to learn what it means.
Valuation
How expensive the stock looks
P/E (TTM)
20.56x
Forward P/E
18.66x
P/B
0.24x
P/S
—
EV/EBITDA
—
PEG ratio
0.92x
Profitability
How much profit each dollar creates
Gross margin
28.8%
Operating margin
0.0%
Net margin
5.2%
ROE
9.8%
ROA
4.8%
Health
Liquidity and balance-sheet strength
Debt / equity
0.32x
Current ratio
1.62x
Quick ratio
0.79x
Total debt
—
Total cash
—
Growth
How the business has been compounding
Revenue TTM
$9.30B
Revenue 5Y CAGR
-1.9%
EPS TTM
1.38
EPS 5Y CAGR
-4.2%
Cash flow
How much cash the business throws off
Operating CF TTM
$851.78M
Free CF TTM
$463.55M
FCF margin
5.0%
Dividend
Shareholder payout
Yield
2.7%
Payout ratio
32.9%
Last ex-div date
2026-10-15