Download PDF

1. Company Snapshot

1.a. Company Description

Hexagon AB (publ) provides information technology solutions for geospatial and industrial applications worldwide.The company operates through two segments, Industrial Enterprise Solutions (IES) and Geospatial Enterprise Solutions (GIS).The IES segment offers metrology systems that incorporate the in-sensor technology for measurements, as well as computer-aided design, computer-aided manufacturing, and computer-aided engineering software.


Its solutions include coordinate measuring machines, laser trackers and scanners, industrial metrology software, and operations management solutions.This segment's solutions are used in electronics and manufacturing, power and energy, automotive, aerospace and defense, and other industries.The GIS segment provides sensors for capturing data from land and air, as well as for positioning through satellites; and GIS software for the creation of 3D maps and models, which are used for decision-making in various software applications covering areas comprising surveying, construction, public safety, and agriculture.


Its solutions comprise laser scanner, airborne camera, unmanned aerial vehicle, mobile mapping technology, and precise positioning solutions.This segment's solutions are used in surveying, infrastructure and construction, natural resources, public safety, aerospace and defense, and other industries.The company was formerly known as Eken Industri & Handel AB and changed its name to Hexagon AB (publ) in 1993.


Hexagon AB (publ) was incorporated in 1975 and is headquartered in Stockholm, Sweden.

Show Full description

1.b. Last Insights on HEXA

Hexagon AB's recent performance has been impacted by several negative drivers. The company's full-year 2025 results showed a decline in net income to €617.4 million, despite slightly higher sales of €5,424.6 million. This profit drop is attributed to various factors, including a restructuring programme targeting cost savings and a CFO transition. Additionally, the company is reshaping its portfolio through planned divestments and the potential separation of its Octave business. Furthermore, Hexagon is navigating currency headwinds and market challenges, which have affected its cash conversion. The company's recent earnings call highlighted these challenges, but also emphasized its strategic acquisitions and innovation efforts.

1.c. Company Highlights

2. Hexagon's Q4 2025 Earnings: A Resilient Performance Amidst Currency Headwinds

Hexagon reported a revenue of EUR 1.4 billion in Q4 2025, with a reported growth of minus 1% but an organic growth of 3%. The company's gross margin was a record strong at 67.5%, driven by a favorable product mix and good pricing and cost management. The operating margin was 29.4%, impacted by significant currency headwinds of 150 basis points. The EPS came in at 0.948, significantly higher than the estimated 0.09786.

Publication Date: Feb -03

📋 Highlights
  • Organic Growth & Margin Impact: Delivered 3% organic growth, with operating margin at 29.4% impacted by 150 bps currency headwinds.
  • Cash Conversion Strength: Achieved 121% cash conversion, driven by robust working capital release of EUR 121 million in Q4.
  • Restructuring Savings: Implemented a restructuring program yielding EUR 11 million savings in Q4, with annualized EUR 65 million run rate expected by 2026.
  • Business Area Performance: Autonomous Solutions grew 23% organically, while Geosystems declined 1% due to China destocking.
  • Octave EBIT Margin: Octave reported 32% EBIT margin, influenced by higher perpetual revenue mix in the prior year and FX headwinds.

Segment Performance

The company's business areas performed variably, with Manufacturing Intelligence growing 1%, Geosystems declining by 1% due to proactive destocking in China, and Autonomous Solutions delivering a strong 23% organic growth. Octave, which is being considered for a potential spin-off, reported 2% organic growth, with 3% recurring revenue growth and double-digit SaaS growth.

Financial Highlights

The company's operating earnings decreased by 7% to EUR 420 million, corresponding to a margin of 29.4%. The net working capital release was EUR 121 million in Q4, and the cash conversion was strong at 121%. As Anders Svensson mentioned, "We are targeting growth with profitable markets and areas for us that continue to grow very rapidly." The company's restructuring program is expected to yield EUR 65 million in annualized savings.

Valuation and Outlook

With a P/E Ratio of 41.9 and an EV/EBITDA of 16.24, the market appears to be pricing in a certain level of growth. Analysts estimate next year's revenue growth at 5.8%. The company's guidance for Q1 2026 suggests a continued headwind from currencies and seasonality. However, with a strong order book and a positive growth outlook, Hexagon is well-positioned to drive efficiency and innovation across the group.

Cash Conversion and Margin Evolution

Hexagon's cash conversion is expected to be around 80% to 90% going forward, according to Norbert Hanke. The company's margin evolution in 2026 is expected to be driven by growth in profitable markets and areas, as well as the contribution from new products. With a strong operating model and leadership position in its markets, Hexagon is confident in its ability to deliver strong results in the year ahead.

3. NewsRoom

Card image cap

Cadence Deepens AI System Design Push With Hexagon Deal And NVIDIA Alliance

Mar -17

Source:

Card image cap

NVIDIA and Global Robotics Leaders Take Physical AI to the Real World

Mar -16

Source:

Card image cap

NVIDIA Announces Open Physical AI Data Factory Blueprint to Accelerate Robotics, Vision AI Agents and Autonomous Vehicle Development

Mar -16

Source:

Card image cap

Hexagon appoints board for Octave

Mar -12

Source:

Card image cap

Mining Automation Industry Research Report 2026-2035: A $6.36 Billion Market with Hexagon, Rockwell Automation, Komatsu, Rio Tinto Group, Sandvik, Caterpillar Leading

Mar -02

Source:

Card image cap

Hexagon (OM:HEXA B) Valuation Check After New Multivista Revizto Construction Workflow Integration

Mar -01

Source:

Card image cap

Hexagon completes sale of Design & Engineering business

Feb -23

Source:

Card image cap

Cadence Completes Acquisition of Hexagon’s Design and Engineering Business, Advancing Leadership in Physical AI and Multiphysics

Feb -23

Source:

4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (6.33%)

6. Segments

Manufacturing Intelligence

Expected Growth: 5.5%

Hexagon AB's Manufacturing Intelligence segment growth of 5.5% is driven by increasing demand for digitalization and Industry 4.0 solutions. The segment's software and metrology solutions enable manufacturers to improve efficiency, quality, and productivity. Strong growth in automotive, aerospace, and energy sectors also contributes to this growth.

Geosystems

Expected Growth: 7.0%

Geosystems from Hexagon AB's growth of 7.0 is driven by increasing demand for geospatial solutions, expanding applications in urban planning, infrastructure development, and environmental monitoring. The segment's growth is also fueled by Hexagon's innovative technologies, strategic acquisitions, and strong presence in the global market, enabling the company to capitalize on emerging trends in geospatial intelligence and digital transformation.

Safety, Infrastructure & Geospatial

Expected Growth: 6.5%

Hexagon AB's Safety, Infrastructure & Geospatial segment growth of 6.5% is driven by increasing demand for smart infrastructure, urbanization, and government investments in public safety. Additionally, the segment benefits from Hexagon's geospatial solutions adoption and growth in recurring revenues from software subscriptions and services.

Asset Lifecycle Intelligence

Expected Growth: 5.8%

Hexagon AB's Asset Lifecycle Intelligence growth of 5.8% is driven by increasing demand for digital transformation, industrial automation, and geospatial solutions. Key drivers include expanding portfolio of software and services, strategic acquisitions, and growing adoption of Industry 4.0 technologies, enabling customers to optimize asset performance, reduce costs, and improve sustainability.

Autonomous Solutions

Expected Growth: 8.0%

Autonomous Solutions' growth is driven by increasing demand for autonomous technologies in industries like agriculture, mining, and construction. Hexagon AB's solutions enable efficient and precise operations, improving productivity and reducing costs. Strong R&D investments and strategic partnerships fuel innovation, expanding the segment's growth potential, resulting in an 8.0% growth rate.

Group Expenses and Eliminations

Expected Growth: 0.0%

The 0.0% growth in Group Expenses and Eliminations for Hexagon AB (publ) likely stems from efficient cost management and effective resource allocation. This stability may indicate a focus on optimizing operational expenses, minimizing eliminations, and maintaining a balanced financial structure, suggesting a strategic effort to enhance profitability and competitiveness.

7. Detailed Products

Autonomous Solutions

Hexagon's Autonomous Solutions provide a range of products and services that enable autonomous operations in various industries such as mining, construction, and agriculture.

Geospatial Mapping

Hexagon's Geospatial Mapping solutions provide accurate and detailed mapping and location-based intelligence for various industries such as government, transportation, and utilities.

Industrial Metrology

Hexagon's Industrial Metrology solutions provide precision measurement and inspection solutions for various industries such as aerospace, automotive, and manufacturing.

CAD/CAM Software

Hexagon's CAD/CAM Software solutions provide computer-aided design and manufacturing software for various industries such as aerospace, automotive, and industrial equipment.

Sensor and Software Solutions

Hexagon's Sensor and Software Solutions provide a range of sensors and software solutions for various industries such as agriculture, construction, and mining.

PPM (Project Portfolio Management)

Hexagon's PPM solutions provide project portfolio management software for various industries such as construction, oil and gas, and utilities.

8. Hexagon AB (publ)'s Porter Forces

Forces Ranking

Threat Of Substitutes

Hexagon AB (publ) operates in a niche market with limited substitutes, but there are some alternatives available. The company's products and services are highly specialized, which reduces the threat of substitutes.

Bargaining Power Of Customers

Hexagon AB (publ) has a diverse customer base, which reduces the bargaining power of individual customers. The company's products and services are critical to its customers' operations, making it difficult for them to switch to alternative suppliers.

Bargaining Power Of Suppliers

Hexagon AB (publ) has a moderate level of dependence on its suppliers, particularly for raw materials and components. While the company has some bargaining power due to its size and reputation, suppliers also have some leverage due to the specialized nature of the products.

Threat Of New Entrants

The barriers to entry in Hexagon AB (publ)'s markets are relatively high, including significant capital requirements, technological expertise, and regulatory hurdles. This reduces the threat of new entrants.

Intensity Of Rivalry

Hexagon AB (publ) operates in a highly competitive market with several established players. The company faces intense competition in terms of product innovation, pricing, and customer service, which increases the intensity of rivalry.

9. SWOT Analysis

Strength

Weaknesses

Opportunities

Threats

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

Value
Debt Weight 28.97%
Debt Cost 4.59%
Equity Weight 71.03%
Equity Cost 8.83%
WACC 7.61%
Leverage 40.78%

11. Quality Control: Hexagon AB (publ) 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

Stock-Card
Flex

A-Score: 5.5/10

Value: 2.2

Growth: 7.1

Quality: 5.5

Yield: 0.0

Momentum: 9.0

Volatility: 9.0

1-Year Total Return ->

View Full Report
Stock-Card
TE Connectivity

A-Score: 5.3/10

Value: 1.7

Growth: 6.6

Quality: 6.8

Yield: 2.5

Momentum: 8.5

Volatility: 6.0

1-Year Total Return ->

View Full Report
Stock-Card
Hexagon

A-Score: 5.1/10

Value: 2.4

Growth: 5.6

Quality: 6.4

Yield: 3.8

Momentum: 6.5

Volatility: 6.0

1-Year Total Return ->

View Full Report
Stock-Card
Check Point

A-Score: 4.7/10

Value: 2.5

Growth: 6.1

Quality: 8.5

Yield: 0.0

Momentum: 5.0

Volatility: 6.0

1-Year Total Return ->

View Full Report
Stock-Card
Garmin

A-Score: 4.7/10

Value: 1.8

Growth: 6.4

Quality: 8.4

Yield: 3.8

Momentum: 3.0

Volatility: 4.7

1-Year Total Return ->

View Full Report
Stock-Card
Capgemini

A-Score: 4.5/10

Value: 4.3

Growth: 6.0

Quality: 5.8

Yield: 3.1

Momentum: 2.0

Volatility: 5.7

1-Year Total Return ->

View Full Report

Peers Metrics

12.e Scoring Insights

12.f DCF BETA

Parameters

Short Term Growth

Short term Time

Long-Term Growth

WACC

Target Price

94.9$

Current Price

94.9$

Potential

-0.00%

Expected Cash-Flows