Autoliv makes airbags, seatbelts and steering wheels — the global leader at ~45% share, with scale, safety-engineering depth and OEM-qualification barriers as the moat. FY2025 (reported in USD) revenue grew ~4% to ~$10.8bn and operating income crossed $1bn for the first time (10.1% margin), with ROIC ~16.1% and economic profit +$308m over a 10% WACC — value-creative through a soft auto-production cycle.
The story is margin expansion (footprint consolidation + automation + price recoveries) on a stable, regulation-driven content base (safety content per vehicle rises over time). At ~12.7x P/E, ~10x EV/EBIT and a 7.7% FCF yield it is an undemanding multiple for the category leader; the risks are cyclical (global light-vehicle production, tariffs/trade), not structural. mttssn rejects the company's small add-backs, so our adjusted EBIT sits ~2% below the company's. Quality cyclical, attractively priced.
At ~12.7x P/E / ~10x EV/EBIT and a 7.7% FCF yield for the global #1 passive-safety supplier with a 10%+ margin and ROIC ~16%, the multiple is undemanding.
Base SEK 1,330 (USD 140, a modest re-rate as the margin plan delivers); bull SEK 1,575 (USD 165) if light-vehicle production recovers + margins reach the mid-teens target; bear SEK 950 (USD 100) on a global auto-production downturn + tariffs.
The market pays today’s enterprise value for roughly 9.9% NOPAT growth over 5 years. The business earns 16% on capital against a 10% cost of capital (spread +6.1 pp); the no-growth value is SEK 933/share (78% of price), so the rest is priced-in growth.
| Scenario | 24m target | Impl. g | Upside | Prob. | Driver |
|---|---|---|---|---|---|
| Bull | SEK 1,575 | ≥15% | +32% | 35% | Light-vehicle production recovers; margins reach mid-teens |
| Base | SEK 1,330 | +15% | +12% | 45% | Modest re-rate as the margin plan delivers |
| Bear | SEK 950 | +1% | -20% | 20% | Global auto-production downturn + tariffs |
| Prob-weighted | SEK 1,340 | — | +12% | 100% | Scenario-weighted expected value |
| WACC \ g | 0% | 3% | 5% | 8% | 10% | 15% |
|---|---|---|---|---|---|---|
| 8.50% | 1,199 | 1,311 | 1,390 | 1,514 | 1,602 | 1,838 |
| 9.25% | 1,052 | 1,142 | 1,204 | 1,303 | 1,372 | 1,556 |
| 10.00% (base) | 933 | 1,006 | 1,057 | 1,135 | 1,190 | 1,332 |
| 10.75% | 836 | 895 | 936 | 998 | 1,041 | 1,150 |
| 11.50% | 755 | 803 | 836 | 885 | 918 | 1,000 |
Green = fair value above the current price of SEK 1,191.00. The reverse-DCF conclusion is dominated by WACC and growth — see the whole surface, not a single fair value.
⤓ Download the full model (.xlsx) — formula-driven sheets; flex the blue input cells and the model cascades in Excel.
Footprint consolidation + automation + price recoveries lift margins toward mid-teens.
Regulation-driven safety content per vehicle rises structurally.
Strong FCF (7.7% yield) funds dividends + buybacks.
~45% global share — scale + qualification barriers.
Autoliv is the global passive-safety leader at a first-ever >10% margin, ROIC ~16%, EP +$308m, undemandingly valued at ~12.7x P/E / 7.7% FCF yield. BUY; base SEK 1,330 (USD 140 at 9.53 SEK/USD).
Own the leader through the cycle for the margin-expansion + capital-return story; size for auto-production cyclicality.
Every adjustment traces to the cited note/page in the source filing — click to open it there. Source reports archived locally.
| Adjustment / figure | Value | Source | Why mttssn treats it this way |
|---|---|---|---|
| Net sales (revenue) | 10,815 | Consolidated Statements of Income; RevenueFromContractWithCustomerExcludingAssessedTax (CY2025) | Net sales for the year ended 31 December 2025 = 10,815 (prior year 10,390), +4.1% YoY. Confirmed in the Multi-Year Summary and the XBRL CY2025 frame. |
| Operating income (GAAP, EBIT) | 1,088 | Consolidated Statements of Income; OperatingIncomeLoss (CY2025) | Operating income (GAAP) = 1,088 (prior year 979). Used directly as mttssn adjusted EBIT (no add-backs). The 10-K Item 7 reconciliation builds Adjusted Operating income 1,114 from this by adding 23 capacity alignment + 3 antitrust. |
| Adjusted operating income (company Non-GAAP) | 1,114 | Reconciliation of Operating income to Adjusted Operating income | Operating income (GAAP) 1,088 + Capacity alignments 23 + Antitrust related items 3 = Adjusted Operating income 1,114 (margin 10.3%). mttssn rejects both add-backs and keeps reported 1,088. |
| Income before income taxes | 986 | Consolidated Statements of Income; IncomeLossFromContinuingOperationsBeforeIncomeTaxes... (CY2025) | Income before income taxes = 986. With tax 250 this gives the 25.4% effective rate. |
| Income tax expense / effective rate | -250 | IncomeTaxExpenseBenefit (CY2025); EffectiveIncomeTaxRateContinuingOperations 0.254 | Income tax expense 250 on pre-tax income 986 = 25.35%, reported effective rate 25.4%. Used for NOPAT. |
| Net income attributable to controlling interest | 735 | NetIncomeLoss (CY2025); total incl. NCI ProfitLoss 736 | Net income attributable to controlling interest 735 (prior year 646); total net income incl. non-controlling interest 736. EPS diluted 9.55. |
| Depreciation & amortization | 407 | DepreciationDepletionAndAmortization (CY2025); also in leverage-ratio EBITDA build | D&A 407 (prior year 387). Used in the adjusted-EBITDA / leverage reconciliation (1,521 adjusted EBITDA). |
| Total interest-bearing debt | 2,153 | Short-term debt 419 + Long-term debt 1,734; ShortTermBorrowings + LongTermDebtNoncurrent | Short-term debt 419 (= current portion / next-12-month principal maturities) + long-term debt 1,734 = total debt 2,153. No separate finance-lease debt line on the net-debt measure. |
| Cash and cash equivalents | 604 | CashAndCashEquivalentsAtCarryingValue (2025-12-31) | Cash 604 at 31 Dec 2025 (prior year 330). 216.3 (~2% of revenue) retained as operational cash; 387.7 treated as excess and stripped from IC. |
| Net debt (company-reconciled Non-GAAP) | 1,566 | Reconciliation of Total debt to Net debt | Total debt 2,153 - cash 604 + debt issuance cost/debt-related derivatives, net 17 = Net debt 1,566 (prior year 1,554). Pure financial net debt = 2,153 - 604 = 1,549. |
| Total equity (incl. NCI) | 2,582 | StockholdersEquityIncludingPortionAttributableToNoncontrollingInterest (2025-12-31); MinorityInterest 10 | Total equity 2,582 incl. non-controlling interest 10; parent equity 2,572 (prior-year total 2,285). Equity-per-share (parent) 34.43. |
| Accumulated other comprehensive income (loss) | -518 | AccumulatedOtherComprehensiveIncomeLossNetOfTax (2025-12-31) | AOCI = -518 (mostly cumulative FX translation loss + pension component). mttssn equity_ex_oci removes this: 2,582 - (-518) = 3,100. |
| Net defined-benefit pension liability | 169 | DefinedBenefitPensionPlanLiabilitiesNoncurrent 169 (+ current 13); plan assets 275 netted | Non-current net DB pension liability 169 (the figure the company adds to net debt in its leverage policy: 1,566 + 169 = 1,736 'Debt per the Policy'); current portion 13 -> total recognized net liability ~182. Included in IC as a debt-like claim. |
| Shares outstanding (latest) | 74.863 | EntityCommonStockSharesOutstanding as of 2026-04-10 | 74,863,338 shares as of the Q1 2026 10-Q cover date; FY2025 10-K balance-sheet count 74.7m, cover-date count 74,706,513. Latest count used for current market cap with verified NYSE ALV price USD 124.58. |
How the mttssn view has evolved — each prior dated note is preserved.