WEBULL

Swedbank (OM:SWED A) Reports Lower Earnings And Settlement, Is It Expensive Or Cheap?

Simply Wall St · 1d ago

Swedbank earnings and regulatory settlement set the context

Swedbank (OM:SWED A) is in focus after second quarter 2026 results showed net income of SEK 7,195 million compared to SEK 7,886 million a year earlier, alongside a separate US$50 million regulatory settlement.

See our latest analysis for Swedbank.

Despite the mixed second quarter and the US$50 million settlement drawing attention to Swedbank, the stock has kept upward momentum, with a 90 day share price return of 12.08% and a 1 year total shareholder return of 60.46%.

If this mix of earnings and regulatory headlines has you thinking about diversification, it could be a good time to broaden your search with 107 top founder-led companies

Swedbank’s share price now sits slightly above the average analyst target, while an intrinsic value estimate points to a large discount. The question for investors is where fair value really lies after this latest earnings and regulatory reset.

Most Popular Narrative: 19.6% Overvalued

Swedbank is trading at SEK 367.3 compared to a widely followed narrative fair value of SEK 307, which is based on detailed revenue, margin and discount rate assumptions.

The assumed bearish price target for Swedbank is SEK307.0, which represents up to two standard deviations below the consensus price target of SEK349.56. This valuation is based on what can be assumed as the expectations of Swedbank's future earnings growth, profit margins and other risk factors from analysts on the more bearish end of the spectrum.

Read the complete narrative.

Want to see how a modest revenue curve, slightly thinner margins and a lower discount rate still produce that fair value gap? The full narrative lays out each assumption, step by step, and how they stack together to challenge today’s share price.

Result: Fair Value of SEK307 (OVERVALUED)

Have a read of the narrative in full and understand what's behind the forecasts.

However, Swedbank’s strong 16% return on equity and sizeable CET1 buffer, together with growing fund inflows and assets under management, could challenge that bearish fair value story.

Find out about the key risks to this Swedbank narrative.

Another View: Swedbank and the DCF fair value gap

The narrative fair value of SEK 307 points to Swedbank being 19.6% overvalued, while our DCF model suggests the opposite. It indicates a fair value estimate of SEK 626.11 per share, which is about 41.3% above the current SEK 367.3 price. Which set of assumptions do you trust more?

Look into how the SWS DCF model arrives at its fair value.

SWED A Discounted Cash Flow as at Jul 2026
SWED A Discounted Cash Flow as at Jul 2026

Simply Wall St performs a discounted cash flow (DCF) on every stock in the world every day (check out Swedbank for example). We show the entire calculation in full. You can track the result in your watchlist or portfolio and be alerted when this changes, or use our stock screener to discover 241 high quality undervalued stocks. If you save a screener we even alert you when new companies match - so you never miss a potential opportunity.

Next Steps

With Swedbank’s mixed signals on valuation, risks and rewards, do not wait for consensus to settle; weigh the upside and concern points in 2 key rewards and 3 important warning signs

Looking for more investment ideas beyond Swedbank?

If Swedbank has sharpened your focus on valuation and risk, do not stop here. Broaden your watchlist with a few focused stock ideas built from data driven screens.

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.