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1. Company Snapshot

1.a. Company Description

Traton SE manufactures commercial vehicles worldwide.It operates in Industrial Business and Financial Services segments.The company offers light and heavy-duty commercial vehicles, such as trucks and bus chassis; vans; construction vehicles; city buses; and intercity and travel coaches, as well as spare parts and services.


It also provides a cloud-based platform for freight transportation under the RIO brand name.The company offers its products and services under the MAN, Scania, Navistar, and Volkswagen Caminhões e Ônibus brands.In addition, it provides a range of financial solutions, including dealer and customer finance, leasing, and insurance products.


The company was founded in 2015 and is based in Munich, Germany.Traton SE is a subsidiary of Volkswagen Finance Luxemburg S.A.

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1.b. Last Insights on 8TRA

Traton SE's recent performance was driven by a slight increase in Q2 deliveries, rising 1% year-over-year, despite uncertainty over U.S. import tariffs. The company's international motors division saw a 10% increase in sales to 17,600 vehicles. However, the U.S. market faces ongoing uncertainty regarding the impact of import tariffs and the economic outlook. Additionally, the company cut production at some plants due to weak truck demand and lowered its full-year expectations for profitability, revenue, and unit sales. A recent strategy playbook highlighted sustainability trends and electrification transitions in the European truck market.

1.c. Company Highlights

2. Traton's Mixed Q2 Performance

Traton's Q2 2025 results show a mixed performance, with deliveries increasing by 9% over Q1, but year-over-year unit sales only growing by 1%. Revenues declined by 2% to EUR 11.3 billion due to unfavorable mix effects and market challenges. The adjusted return on sales was 6.4%, down 2.3 percentage points year-over-year. EPS came out at '0.575', relative to estimates at '1.13', indicating a significant miss.

Publication Date: Jul -28

📋 Highlights
  • Delivery and Sales Growth:: Deliveries rose by 9% from Q1, while year-over-year unit sales grew only 1%.
  • Revenue Decline:: Revenues dropped 2% to EUR 11.3 billion due to unfavorable mix effects and market challenges.
  • Profitability Drop:: Adjusted return on sales fell to 6.4%, a decrease of 2.3 percentage points year-over-year.
  • Regional Performance:: Europe saw a 44% increase in truck orders, while North America experienced a 15% decline.
  • Electric Vehicle Progress:: 1,250 electric vehicles delivered in H1, with a target of up to 1,000 by year-end.

Financial Performance

The company's adjusted operating result was lower due to revenue decline and underutilized production capacity. Traton Financial Services saw revenues increase by 14%, but return on equity decreased to 8.4%. The company's gross cash flow was EUR 2.0 billion in the first half of 2025, and net cash flow turned positive in Q2 despite a EUR 1.2 billion investment spend.

Market Outlook and Guidance

The company decided to lower its full-year outlook, with a new market outlook for North America, expecting a decline of 17.5% to 7.5% in truck sales. European and South American market outlook remained unchanged. The adjusted outlook for 2025 assumes a decline in unit sales between -10% and 0%. Revenue outlook for TRATON Group and TRATON Operations was lowered, with an expected return on sales of 6-7% for TRATON Group and 7-8% for TRATON Operations.

Valuation and Analyst Estimates

Analysts estimate next year's revenue growth at 6.4%. The stock trades at a P/E Ratio of 5.99, a P/B Ratio of 0.81, and a P/S Ratio of 0.32, indicating a relatively low valuation. The EV/EBITDA ratio is 1.79, and the Dividend Yield is 5.65%. The Free Cash Flow Yield is -2.67%, and the ROIC is 6.95%.

Challenges and Opportunities

The company faces tough market conditions, with a decline in registrations and order activity. However, Traton's long-term transformation towards sustainable mobility continued, with Scania launching a high-capacity charging solution for heavy-duty e-trucks and MAN starting series production of its heavy-duty electric trucks. The company delivered 1,250 fully electric vehicles in the first half of the year, targeting up to 1,000 units by year-end.

Management's View

Management notes that the company needs to see a pick-up in order intake in the second half of this year to plan for growth in 2026. The full-year guidance range is wide due to various scenarios, including no major changes in tariffs, but with a possible impact from foreign exchange rates and market conditions.

3. NewsRoom

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Moving Forward With a Proven Leadership Team: TRATON GROUP Extends Contracts of Dr. Jackstein and Modahl Nilsson

Nov -24

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Traton's (ETR:8TRA) Conservative Accounting Might Explain Soft Earnings

Nov -06

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Is Traton SE (ETR:8TRA) Trading At A 44% Discount?

Nov -03

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Traton Narrows Guidance as Profit Slumps

Oct -29

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Truck Stocks Rise on Tariff Exemptions

Oct -20

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Daimler Truck's North America sales shrink in Q3

Oct -08

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Dr. Arno Antlitz Appointed as Member of the Supervisory Board of TRATON SE

Sep -29

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Heard on the Street Friday Recap: Another Dose of Tariffs

Sep -29

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4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (3.19%)

6. Segments

Scania Vehicles & Services

Expected Growth: 4%

Scania Vehicles & Services' 4% growth is driven by increasing demand for sustainable transportation solutions, expansion in emerging markets, and a strong aftermarket business. Additionally, Traton SE's strategic investments in digitalization, electrification, and autonomous driving are enhancing Scania's competitiveness, while a growing focus on services and subscription-based models is generating recurring revenue streams.

MAN Truck & Bus

Expected Growth: 3%

MAN Truck & Bus's 3% growth is driven by increasing demand for heavy-duty trucks in Europe, expansion in emerging markets, and a focus on alternative drivetrains. Additionally, Traton SE's investments in digitalization and electrification are expected to improve operational efficiency and reduce costs, further supporting growth.

Navistar Sales & Services

Expected Growth: 2%

Navistar Sales & Services' 2% growth is driven by increasing demand for commercial vehicles, particularly in North America, and Traton SE's strategic investments in digitalization, electrification, and autonomous driving. Additionally, the company's focus on expanding its aftermarket business and improving operational efficiency also contribute to its growth.

Volkswagen Truck & Bus

Expected Growth: 3%

Volkswagen Truck & Bus's 3% growth is driven by increasing demand for heavy-duty trucks in emerging markets, expansion of e-mobility solutions, and strategic partnerships to enhance global presence. Additionally, investments in digitalization and autonomous driving technologies are expected to improve operational efficiency and reduce costs.

TRATON Financial Services

Expected Growth: 5%

TRATON Financial Services' 5% growth is driven by increasing truck sales, expansion into new markets, and a growing share of financing solutions for Scania, MAN, and Volkswagen Commercial Vehicles. Additionally, the company's digitalization efforts, such as online financing platforms, and strategic partnerships with banks and leasing companies, contribute to its growth momentum.

Reconciliation

Expected Growth: 1%

Traton SE's growth is driven by increasing demand for commercial vehicles, particularly in Europe and South America. The company's focus on electrification, autonomous driving, and digitalization also contributes to growth. Additionally, strategic partnerships and acquisitions, such as the Navistar deal, expand Traton's market presence and capabilities.

7. Detailed Products

Scania Trucks

Heavy-duty trucks for long-haulage, construction, and distribution

Scania Buses

City buses, coaches, and tourist buses for public transportation

MAN Trucks

Heavy-duty trucks for long-haulage, construction, and distribution

MAN Buses

City buses, coaches, and tourist buses for public transportation

Volkswagen Commercial Vehicles

Light commercial vehicles, vans, and trucks for urban distribution

RIO Box

Cloud-based platform for fleet management and logistics

Scania Financial Services

Financial solutions for vehicle financing, leasing, and insurance

8. Traton SE's Porter Forces

Forces Ranking

Threat Of Substitutes

Traton SE's products are moderately substitutable, as customers have some alternatives, but they are not easily replaceable.

Bargaining Power Of Customers

Traton SE's customers have limited bargaining power due to the company's strong brand and limited alternatives.

Bargaining Power Of Suppliers

Traton SE's suppliers have moderate bargaining power, as the company relies on a few key suppliers, but has some flexibility to switch.

Threat Of New Entrants

The threat of new entrants is low for Traton SE, as the industry has high barriers to entry and significant capital requirements.

Intensity Of Rivalry

The intensity of rivalry in the industry is high, with several established players competing for market share.

9. SWOT Analysis

Strength

Weaknesses

Opportunities

Threats

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

Value
Debt Weight 55.75%
Debt Cost 5.42%
Equity Weight 44.25%
Equity Cost 11.00%
WACC 7.89%
Leverage 125.97%

11. Quality Control: Traton SE passed 4 out of 9 key points

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

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Logista

A-Score: 7.4/10

Value: 7.0

Growth: 5.9

Quality: 5.8

Yield: 10.0

Momentum: 6.0

Volatility: 10.0

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Strabag

A-Score: 6.6/10

Value: 8.1

Growth: 4.7

Quality: 6.2

Yield: 8.1

Momentum: 10.0

Volatility: 2.7

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Traton

A-Score: 5.6/10

Value: 9.8

Growth: 5.9

Quality: 4.4

Yield: 6.2

Momentum: 3.5

Volatility: 4.0

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Konecranes

A-Score: 5.5/10

Value: 4.5

Growth: 7.1

Quality: 7.2

Yield: 5.6

Momentum: 5.5

Volatility: 3.0

1-Year Total Return ->

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Iveco

A-Score: 5.2/10

Value: 7.3

Growth: 6.7

Quality: 3.0

Yield: 1.9

Momentum: 9.5

Volatility: 2.7

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KION

A-Score: 4.5/10

Value: 6.4

Growth: 4.0

Quality: 3.3

Yield: 1.9

Momentum: 9.0

Volatility: 2.3

1-Year Total Return ->

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Peers Metrics

12.e Scoring Insights

12.f DCF BETA

Parameters

Short Term Growth

Short term Time

Long-Term Growth

WACC

Target Price

29.5$

Current Price

29.5$

Potential

-0.00%

Expected Cash-Flows