SAAB - Launchers and Submarines

Hi! Here are my thoughts about the recently announced order that Saab received right before Easter.

The company received an order from the Swedish Defence Materiel Administration (FMV) for a mobile and modular counter-unmanned aircraft system (C-UAS) valued at approximately 230 MEUR (2.6 BSEK). The order strengthens Saab’s position in one of the fastest-growing segments in modern defense (Source: 1, 2) , with deliveries scheduled for 2027-2028. We view this as an expected continuation of Saab’s close cooperation with the Swedish Armed Forces rather than a surprise. Link to the press release.

Drone defense has become one of the defining capability gaps on the modern battlefield. The ordered system is designed to detect, track, and neutralize low-flying small and medium-sized drones; the kind that have reshaped tactics in Ukraine and driven a sharp rise in global C-UAS demand. The system integrates Saab’s own sensors and technologies into a compatible whole, built to protect both military targets and civilian infrastructure. The order will be booked under the Surveillance business area, which grew revenue by 24% in 2025 and sits at the core of Saab’s sensor technology and system integration capabilities.

In absolute terms, 230 MEUR is a meaningful order. In the context of Saab’s current order book, it is a relatively modest addition. The company’s order intake in Q4’25 alone reached a record approximately 8,850 MEUR (100 BSEK). That said, the order does exactly what a steady domestic order flow is supposed to do: it reinforces confidence that Saab can sustain a strong delivery pace and remain on track toward its updated financial targets for 2023-2027.

We expect Saab’s revenue to grow by 21.1% to approximately 8,482 MEUR (95,849 MSEK) in 2026 and by 18.8% to approximately 10,079 MEUR (113,892 MSEK) in 2027. On our estimates, EBIT should grow by 26% and 21% in those same years, while EPS should grow by 28% and 21%. From our point of view, the valuation remains demanding at 2026e P/E 43.5x, but strategic execution and a stable domestic order flow continue to reduce the execution risk that would otherwise make that multiple significantly harder to digest. We believe that modular, easily integrable systems like this C-UAS are a good illustration of how Saab is positioning itself to meet the scale of NATO’s and Europe’s growing defense needs.

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