Hello, everyone,
Many of you have been asking for updates on dividend growth stocks from time to time.
A dividend yieldthat will reach 7% by 2028 might bring a little joy to some of the dividend investors among you.
That’s why, fresh off the quarterly earnings report, I’ve $VALMT (+0,11 %) .
As always, I’d love to hear your opinions and thoughts in the comments.
Valmet Oyj Reports H1 Results
July 24, 2026,
- Pressemitteilung by Valmet Oyj (VOYJF): Earnings per share: €0.59, +22% year-to-date
- Adjusted EPS: €0.73, +15% year-over-year
- Net revenue: €2,560 million, +6% year-to-date
- Orders received: €2,466 million, -14% year-to-date
- Order backlog: €4,259 million, -10% year-over-year
- Comparable EBITA: €266 million, flat year-over-year
- Comparable EBITA margin: 10.4%, down 0.5 percentage points year-over-year
- EBITA: €232 million, up 19% year-to-date
Valmet Initiates a Strategic Review to Evaluate a Potential Separation of the Two Segments
July 24, 2026,
The Board of Directors of Valmet Oyj has decided to initiate a strategic review to evaluate a potential separation of its two core businesses, Biomaterial Solutions and Services and Process Performance Solutions, into two independent publicly traded companies. The review will focus on assessing whether separating the two businesses and operating them as separately listed companies on the Nasdaq Helsinki would create additional value for shareholders compared to the current combined structure.
Both of Valmet’s core businesses report as standalone segments and have grown into large, largely independent, profitable companies, each with a strong market position and sufficient scale to enable them to succeed independently. With the recent completion of the Severn acquisition, which has increased Process Performance Solutions’ annual net sales to approximately 1.7 billion euros and with the renewed operating model now firmly established, the Board of Directors believes this is the right time to assess whether a separation would unlock shareholder value by enabling each company to better realize its full potential.
The Executive Board also notes that the two core businesses operate relatively independently of one another, as they primarily serve different customer industries, have different business drivers, and exhibit different capital allocation profiles. Biomaterial Solutions and Services is a global technology and lifecycle services company focused on the pulp, cardboard, paper, tissue, and energy industries, with a competitive advantage based on a large installed base, advanced technology, global presence, strong customer references, and global service penetration. Process Performance Solutions is a mission-critical automation and flow control company that serves a diverse range of industries. Over the past decade, the company has evolved from a business focused primarily on pulp and paper into a diversified industrial platform, with nearly 70 percent of its net revenue now coming from other industries.
Based on the Board of Directors’ initial assessment, a spin-off would enable each company to pursue sustainable, profitable growth opportunities more independently and efficiently, with the potential for a stronger management focus, greater agility, more tailored capital allocation, and more flexible access to external capital to support both organic and inorganic growth. The Executive Board will also examine whether a separation, if implemented, would improve transparency, simplify governance, and enable the capital markets to better recognize the full value of both companies.
Pekka Vauramo, Chairman of the Board, said:
“The Board of Directors continuously evaluates how to create the greatest possible long-term value for Valmet’s shareholders. Today, Valmet consists of two strong companies with different markets, growth opportunities, and capital allocation needs. Through this review, we will assess whether they can create more value as independent companies than they do together. We will proceed with a separation only if, after a detailed analysis, we conclude that the separation is clearly in the best interests of our shareholders.”
Thomas Hinnerskov, President and CEO of Valmet, said:
“Both of our companies are well-positioned, with strong customer relationships and market positions, as well as talented employees. This review reflects the strength and maturity of both companies, which we have built through strong execution, organic growth, and strategic investments into significant and successful businesses with the size, capabilities, and opportunities to create further value—both together and potentially as independent companies. This review does not change our commitment to our customers or our strategy. It is a priority for us to preserve the strength of our entire offering and the added value our customers gain from the synergy of services, automation, and technology. Throughout this process, our focus remains on serving our customers and creating value to support their success.”
Although the strategic review has been initiated, there is no guarantee that the review will lead to a transaction, including a separation. The Board of Directors will only implement or recommend changes to the Group’s structure if there is clear evidence of increased shareholder value. Valmet will provide an update on the review in connection with the publication of its 2026 full-year results.
Valmet Oyj is an industrial group organized into five business areas:
- Services (35.5% of net sales): Production equipment for pulp, paper, and textile fibers, as well as bioenergy power plants; maintenance and repair; machine automation; and services to improve production processes. The Group also offers spare parts;
- Sales of machinery and equipment for paper manufacturing (21.5%);
- Sales of energy and pulp production equipment (16.2%);
- Sales of flow control solutions for the process industry (14.8%);
- Sales of factory automation systems (12%): monitoring and control systems, measurement systems, image processing systems, solutions to improve the efficiency of production processes, etc., intended primarily for the pulp and paper industry as well as power generation.
Net revenue is distributed geographically as follows: Europe/Middle East/Africa (37.9%), China (13.5%), Asia/Pacific (12.5%), North America (27.2%), and South America (8.9%).
Number of employees: 18,370
With a market share of 35–50% in key biomaterial processing technologies, Valmet has built one of the industry’s largest installed bases—a structural advantage that drives recurring revenue and long-term customer relationships. As one of the world’s leading service partners, Valmet supports customers throughout the entire lifecycle—from initial delivery through decades of operation.
Structural growth opportunities are identified in both segments. In the area of Biomaterial Solutions and Services , the goal is to double organic service growth to 8% and increase market share to 25% by 2030. Process Performance Solutions has become one of Valmet’s key drivers of growth and profitability. Within this segment, they provide critical technologies, automation solutions, and services that improve their customers’ resource efficiency, reduce emissions, and support their core operations. Following the acquisition of Severn, the segment’s annual net sales will rise to approximately 1 to 7 billion euros, further strengthening its strategic position within the Valmet portfolio. The goal is to grow organically at a rate more than double that of the market.
These ambitions are supported by strong fundamentals, a lean operating model, and a clear financial framework for 2030: 5% organic growth, a 15% comparable EBITA margin, and 20% ROCE.
Juan’s Conclusion on Valmet’s Financial Metrics for 2025–2028
(brief, clear, investor-friendly)
Valmet delivers a stable, clean set of financials with clear improvement across the entire forecast period. Revenue is growing moderately, but profitability is picking up significantly —especially the EBIT margin rises each year, reaching nearly 11%, which is strong for an industrial plant manufacturer.
The free cash flow will surge sharply in 2027/2028, which fundamentally supports the stock. The Net debt is falling again, and leverage ratio falls to 1.17x by 2028 —a positive sign for balance sheet quality.
ROE is rising steadily, and EPS is growing at a double-digit rate— Valmet is becoming more profitable, more efficient, and more shareholder-friendly every year. For Juan, this is a classic “quality compounder” profile: no explosive growth, but a reliable, steady improvement in key metrics.
Market Value 4,061
Number of Shares (in thousands) 184,238
Publication Date 02/06/2026
Juan’s Conclusion on the Valuation Metrics
Valmet is valued more favorably each year, while its cash flow and dividend power are increasing. The P/E ratio is falling from 18.6x to below 10x, and the P/B ratio is sliding toward 1.4x —clear downward pressure on the valuation, but without any loss of quality.
The FCF yield will rise to over 10% by 2028, which Juan sees as a classic “underpriced quality” signal . Dividends are growing steadily, yields are rising— Valmet is becoming more attractive to income investors every year.
A PEG ratio below 1 starting in 2027 indicates: the valuation-to-growth ratio is shifting into the comfort zone. For Juan, this is a calm, clean downward valuation driftthat provides fundamental tailwind.
July 24, 2026, 5:34:03 PM •
Tradegate BSX (EUR)
26.94 EUR
