Kepler Cheuvreux has moved Epiroc into a buy recommendation, upgrading the mining equipment manufacturer from 'hold' to 'buy' while increasing its price target to 300 Swedish crowns from 245 crowns. The brokerage said the change reflects Epiroc's exposure to what it described as "the more attractive parts of the cycle."
The revised target equates to an 18.6% upside from Epiroc's current share price of 252.90 crowns and marks a 22.4% rise compared with Kepler's previous target.
In its note, Kepler Cheuvreux characterised Epiroc as "a quality mining play with upside optionality, supported by a strong capital structure, best-in-class profitability and strong cash conversion." The brokerage listed several demand drivers it sees supporting the company, including exposure to copper and gold, replacement demand from ageing fleets, an exploration recovery and what it referred to as the "aftermarket/opex wave."
Kepler also identified further sources of potential upside: electrification, a recovery in the Tools & Attachments division, and scope for mergers and acquisitions.
On the earnings and sales outlook, Kepler Cheuvreux raised its adjusted EBIT estimates for 2026 and 2027 by 5.6% and 14.8%, respectively. The brokerage forecast a 13.5% adjusted EBIT compound annual growth rate over 2025-28. It also increased its sales change assumptions to 6.2% for 2026 and 12.8% for 2027.
"With the valuation premium narrowing as earnings accelerate, we see an attractive risk-reward profile," the note said.
Separate analyst activity has also moved in Epiroc's favour. Last month, BofA Securities upgraded the stock to 'buy' from 'underperform' and raised its price objective to 330 Swedish crowns from 225 crowns, citing an anticipated wave of large copper project final investment decisions expected over the next four years.
Market context and implications
- The upgrade and higher target from Kepler reflect confidence in demand linked to metal prices and replacement cycles in mining fleets.
- Raised earnings and sales forecasts imply analysts expect accelerating profitability and revenue growth over the mid-term period covered by the estimates.
- Other broker activity, including BofA's recent upgrade and higher objective, underscores a broader shift among some analysts toward greater optimism on Epiroc tied to copper project investment activity.