Ponsse Oyj (PON1V.HE) | Investment Case

1. Company Snapshot

1.a. Company Description

Ponsse Oyj, together with its subsidiaries, develops, manufactures, and sells cut-to-length forest machines Northern Europe, Central and Southern Europe, Russia and Asia, North and South America, and internationally.Its products include harvesters, forwarders, harvester heads, and dual machines.The company also offers information system products, such as harvester and forwarder systems; forest machine; and wood procurement systems; and simulators.

In addition, it provides spare parts; and used machines.Ponsse Oyj was founded in 1970 and is headquartered in Vieremä, Finland.

Show Full description

1.b. Last Insights on PON1V

Ponsse Oyj faced challenges over the recent 3 months, despite posting standout earnings growth. The company's profits surged 352.6% over the past year, driven by improved profitability. However, no information on short-term negative drivers was available. The company's net profit margins rose to 4.8% from last year's 1%. Forecasts indicate annual earnings growth of 18.85% and revenue growth of 6.8%, outpacing Finland's market averages. There is no mention of a share buyback or legal issues.

1.c. Company Highlights

Last Price	25.7
Change Percentage	0.39%
Open	25.6
Previous Close	25.6
Market Cap ( Millions)	719
Volume	715
Year High	32
Year Low	19.55
M A 50	25.71
M A 200	27.55

FCF Yield	6.12%
Dividend Yield	1.95%
ROE	16.85%
Debt / Equity	21.12%
Net Debt / EBIDTA	19.31%
Price To Book	2.21
Price Earnings Ratio	13.07
Price To FCF	16.35
Price To sales	0.77
EV / EBITDA	6.47

2. Transcript Summary

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3. NewsRoom

Exploring 3 Promising European Small Caps with Strong Potential

Nov -20

Source:

Ponsse's new digital service revolutionises the monitoring of logging emissions

Nov -19

Source:

Ponsse Oyj (HLSE:PON1V) Net Margin Surges to 4.8%, Reinforcing Profitability Turnaround Narrative

Oct -23

Source:

European Value Stocks: 3 Companies Priced Below Estimated Worth

Apr -25

Source:

3 Undiscovered European Gems with Strong Potential

Apr -25

Source:

Ponsse Greasing System - new solutions for forest machines chain lubrication

Apr -02

Source:

Unveiling 3 European Stocks Possibly Priced Below Intrinsic Value

Mar -25

Source:

3 European Growth Companies With High Insider Ownership Growing Earnings At 71%

Mar -17

Source:

4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (2.59%)

6. Segments

Forest Machines

Expected Growth: 2.5%

Ponsse Oyj's Forest Machines segment growth of 2.5% is driven by increasing demand for sustainable forestry practices, government initiatives promoting reforestation, and rising adoption of mechanized harvesting solutions. Additionally, the company's focus on innovation, expanding distribution network, and strong brand reputation contribute to its growth momentum.

Service

Expected Growth: 2.8%

Ponsse Oyj's 2.8% growth is driven by increasing demand for sustainable forestry practices, government initiatives promoting reforestation, and the company's innovative harvesting solutions. Additionally, expansion into new markets, particularly in Asia and South America, and strategic partnerships with forestry companies contribute to the growth.

Information Systems

Expected Growth: 3.2%

Ponsse Oyj's 3.2% growth in Information Systems is driven by increasing demand for digital forestry solutions, expansion into new geographic markets, and investments in research and development to enhance product offerings. Additionally, the company's focus on customer experience and partnerships with forestry companies contribute to its growth momentum.

7. Detailed Products

Harvesters

Ponsse Oyj's harvesters are designed for efficient and safe harvesting of wood. They are equipped with advanced technology and ergonomic design to ensure operator comfort and productivity.

Forwarders

Ponsse Oyj's forwarders are designed for transporting felled trees from the forest to the roadside. They are built for reliability, durability, and high-capacity loading.

Bogie Trucks

Ponsse Oyj's bogie trucks are designed for transporting heavy loads in challenging terrain. They are equipped with advanced suspension systems and high-traction wheels.

Forest Machines

Ponsse Oyj's forest machines are designed for a variety of forestry tasks, including harvesting, forwarding, and planting. They are built for reliability, durability, and high-performance.

Information Systems

Ponsse Oyj's information systems are designed to optimize forestry operations, providing real-time data and analytics to improve efficiency and reduce costs.

8. Ponsse Oyj's Porter Forces

Forces Ranking

Threat Of Substitutes

Ponsse Oyj's products are specialized and customized, making it difficult for customers to find substitutes. However, the company still faces some threat from substitutes, especially from other forestry machinery manufacturers.

Bargaining Power Of Customers

Ponsse Oyj's customers are mainly large forestry companies and contractors, which have limited bargaining power due to their dependence on Ponsse's specialized products.

Bargaining Power Of Suppliers

Ponsse Oyj relies on a few key suppliers for critical components, giving them some bargaining power. However, the company's strong relationships with suppliers and its ability to negotiate prices mitigate this risk.

Threat Of New Entrants

The forestry machinery industry has high barriers to entry, including significant capital requirements and the need for specialized expertise. This makes it difficult for new entrants to compete with established players like Ponsse Oyj.

Intensity Of Rivalry

The forestry machinery industry is highly competitive, with several established players competing for market share. Ponsse Oyj faces intense rivalry from companies like John Deere, Komatsu, and Caterpillar.

9. SWOT Analysis

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

	Value
Debt Weight	27.07%
Debt Cost	5.35%
Equity Weight	72.93%
Equity Cost	8.00%
WACC	7.28%
Leverage	37.12%

11. Quality Control: Ponsse Oyj passed 4 out of 9 key points

Strong Liquidity

Low Debt

Strong Interest Coverage

Healthy Cash Flow

Operating Inefficiency

Strong Return On Equity

Consistent Revenue Growth

Consistent Operating Cash Flow Growth

Margin Improvement

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

Wacker Neuson

A-Score: 6.0/10

Value: 6.8

Growth: 4.8

Quality: 4.1

Yield: 6.9

Momentum: 8.5

Volatility: 4.7

1-Year Total Return ->

Ponsse

A-Score: 5.5/10

Value: 6.0

Growth: 3.4

Quality: 6.5

Yield: 3.8

Momentum: 8.5

Volatility: 4.7

1-Year Total Return ->

Exel

A-Score: 5.3/10

Value: 9.3

Growth: 4.8

Quality: 3.6

Yield: 5.0

Momentum: 1.5

Volatility: 7.3

1-Year Total Return ->

Rosenbauer

A-Score: 4.6/10

Value: 6.1

Growth: 5.1

Quality: 2.4

Yield: 1.2

Momentum: 8.5

Volatility: 4.3

1-Year Total Return ->

AKVA group

A-Score: 4.6/10

Value: 4.9

Growth: 5.4

Quality: 4.4

Yield: 0.6

Momentum: 10.0

Volatility: 2.0

1-Year Total Return ->

Engcon

A-Score: 2.7/10

Value: 0.2

Growth: 4.2

Quality: 7.8

Yield: 0.6

Momentum: 1.0

Volatility: 2.3

1-Year Total Return ->

Peers Metrics

12.e Scoring ^Insights

12.f DCF ^BETA

Parameters

Short Term Growth

-2.72%

Short term Time

10.0

Long-Term Growth

2.00%

WACC

7.28%

Ponsse Oyj - FI0009005078

1. Company Snapshot

1.a. Company Description

1.b. Last Insights on PON1V

1.c. Company Highlights

Weak Momentum

Lower Quality

Lower Growth

Earnings Miss

Revenues Miss

Expensive

Average Growth

Stable Momentum

Earnings Beats

Average Quality

Revenues Beats

Fairly Valued

Average Yield

Strong Momentum

2. Transcript Summary

3. NewsRoom

4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (2.59%)

6. Segments

Forest Machines

Expected Growth: 2.5%

Service

Expected Growth: 2.8%

Information Systems

Expected Growth: 3.2%

7. Detailed Products

Harvesters

Forwarders

Bogie Trucks

Forest Machines

Information Systems

8. Ponsse Oyj's Porter Forces

Forces Ranking

Threat Of Substitutes

Bargaining Power Of Customers

Bargaining Power Of Suppliers

Threat Of New Entrants

Intensity Of Rivalry

9. SWOT Analysis

Strength

Weaknesses

Opportunities

Threats

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

11. Quality Control: Ponsse Oyj 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

Peers Metrics

12.e Scoring Insights

12.f DCF BETA

Parameters

Short Term Growth

Short term Time

Long-Term Growth

WACC

Target Price

25.7$

Current Price

25.7$

Potential

-0.00%

Expected Cash-Flows

12.e Scoring ^Insights

12.f DCF ^BETA