WEBULL

Epiroc (OM:EPI A) Stock Faces Rich Valuation As Q2 EPS Supports Growth Narrative

Simply Wall St · 2d ago

Epiroc (OM:EPI A) has put fresh numbers on the table for Q2 2026, with revenue at about SEK16.7b and basic EPS of SEK2.01, giving investors a clear snapshot of how the business is earning on its current size. The company has seen quarterly revenue move from SEK15.1b in Q2 2025 to SEK16.7b in Q2 2026, while basic EPS shifted from SEK1.74 to SEK2.01 over the same period, setting the scene for the latest set of results. With a trailing net profit margin of 14.2%, the focus now is on how durable these margins look as the story develops.

See our full analysis for Epiroc.

With the headline figures on the board, the next step is to see how these results line up with the most common narratives around Epiroc, highlighting where the data supports the story and where it starts to push back.

See what the community is saying about Epiroc

OM:EPI A Revenue & Expenses Breakdown as at Jul 2026
OM:EPI A Revenue & Expenses Breakdown as at Jul 2026

Margins Hold Steady Around 14%

  • Epiroc’s trailing twelve month net income sits at about SEK 8.8b on SEK 62.4b of revenue, which lines up with the 14.2% net margin mentioned in the data and is only slightly above the 14.1% margin cited for the prior year.
  • What stands out for the bullish narrative is that this steady 14.2% margin today is being compared with expectations for margins to rise to around 16.2% or even 17.0% in the coming years. Yet the latest numbers still cluster close to that 14% starting point, which means:
    • Bulls pointing to higher margin potential are leaning on the idea that today’s SEK 8.8b of trailing earnings on SEK 62.4b of revenue is a base from which efficiency programs and more high margin service work could add a few percentage points over time.
    • At the same time, the fact that the margin is almost unchanged from the 14.1% level cited for the prior year shows that any bullish case built on faster margin expansion is not yet clearly reflected in trailing profitability.

Bulls argue that this stability in Epiroc’s 14.2% margin sets up room for expansion if automation and service keep scaling, and you can see how that thesis is framed in more detail in the 🐂 Epiroc Bull Case

Premium P/E Versus DCF Fair Value

  • The stock trades on a trailing P/E of 32.2x against a current share price of SEK 235.0, while the supplied DCF fair value is SEK 228.83 and the analyst price target to compare with is SEK 284.00.
  • Critics in the bearish narrative focus on this rich multiple and the gap to DCF fair value, arguing that expectations already look demanding, and the current data offer some clear support for that caution:
    • The 32.2x P/E sits above both the Swedish Machinery industry average of 28.1x and the peer average of 27.2x, so investors are paying a higher price for each krona of earnings than for many similar stocks even though trailing margins are around 14.2%.
    • The share price of SEK 235.0 is above the DCF fair value of SEK 228.83, so anyone leaning on discounted cash flow in the bearish story can point to the valuation sitting above that reference point even before assuming any slowdown in the forecasted 13.35% earnings and 9.3% revenue growth.

Skeptics who worry that a 32.2x P/E leaves little room for disappointment will find detailed arguments for that view in the 🐻 Epiroc Bear Case

Quarterly EPS Trend Backs Growth Story

  • On a quarterly basis, Epiroc’s basic EPS moved between SEK 1.62 and SEK 2.01 over the last six reported quarters, with the latest Q2 2026 figure of about SEK 2.01 sitting above the prior Q2 2025 level of roughly SEK 1.74 and contributing to a trailing twelve month EPS of around SEK 7.31.
  • The consensus style growth narrative that expects earnings to grow at roughly 13.35% per year with revenue around 9.3% per year leans heavily on this kind of steady EPS pattern. Yet the numbers also highlight some friction with that story:
    • Supporters can point out that trailing EPS of SEK 7.31 on SEK 62.4b of revenue fits with a business that has kept earnings in a narrow band over several quarters while still posting a 14.2% net margin, which lines up with forecasts that do not require a sudden step change to justify growth assumptions.
    • On the other hand, the data also note that over a five year period earnings grew at about 4.6% per year and that earnings were negative over the most recent year used in that long term comparison, so anyone extrapolating the 13.35% forecast growth rate from these quarterly EPS figures needs to be aware that the longer horizon has been more muted.

Next Steps

To see how these results tie into long-term growth, risks, and valuation, check out the full range of community narratives for Epiroc on Simply Wall St. Add the company to your watchlist or portfolio so you'll be alerted when the story evolves.

After weighing both the bullish and bearish angles on Epiroc, it helps to go back to the raw figures and judgement calls behind them. If you want to see exactly what some investors are optimistic about, take a closer look at the 2 key rewards

See What Else Is Out There

Epiroc’s rich 32.2x P/E relative to peers, together with a net margin that remains close to 14%, means investors are paying up without clear margin expansion yet.

If that premium on Epiroc makes you uneasy, you can quickly compare it with companies trading closer to their estimated worth by scanning the 231 high quality undervalued stocks.

This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.