Rockwool 1Q26 results in line with expectations; Goldman Sachs reiterates Buy with a 12-month target price of DKK 230

Overview

This is a Goldman Sachs 1Q26 earnings review on Rockwool. The report believes the company's 1Q26 results and 2026 setup were broadly in line with expectations, and that the raised revenue guidance remains achievable; near-term energy inflation has a limited impact on the 2Q26 income statement, while long-term earnings growth is mainly driven by capacity expansion. Goldman Sachs maintains a Buy rating with a 12-month target price of DKK 230.

Core views

Goldman Sachs' core view is that, as the leader in the rock wool category, Rockwool is currently trading at about 14x 12-month forward P/E, a discount to its 20-year average of 19x; if 2026 guidance, price increases, share gains, and capacity ramp-up are gradually delivered, there is room for a valuation re-rating. The report expects earnings CAGR of about +7% from 25-2030, with most of it coming from capacity expansion, which is more concentrated in the U.S. and other non-European regions.

Analysis framework

The report evaluates Rockwool along several main lines: the 1Q26 earnings call, 2026 revenue guidance, 2Q trading conditions, energy and transportation costs, pricing power, the timing of capacity projects, M&A integration, and valuation methodology. Valuation uses an equally weighted P/E and DCF approach, combined with Goldman Sachs' earnings forecast revisions to derive the target price.

Methodology notes

• Valuation methodsP/E valuation

  Relative valuation based on price-to-earnings ratio

  Half of the target price weighting comes from a 16x forward P/E valuation, corresponding to DKK 230/share; previously it was DKK 225, weighted 75% on 2027E EPS and 25% on 2028E EPS.

• Valuation methodsDCF

  Discounted cash flow valuation

  Half of the target price weighting comes from a DCF valuation, corresponding to DKK 230/share; key assumptions include a 7.4% WACC and a 2% terminal growth rate.

• Factor analysisGS Factor Profile

  Goldman Sachs factor profile

  This framework compares a stock's growth, financial returns, valuation multiples, and composite score with the market and industry peers to supplement the investment context.

• M&A analysisM&A Rank

  Probability score of becoming an acquisition target

  Goldman Sachs categorizes M&A Rank into levels 1 to 3, with 3 representing a lower probability of becoming an acquisition target, at 0%-15%, and it is usually not included in the target price.

• Data toolsQuantum

  Goldman Sachs proprietary financial database

  Quantum is used to obtain financial statement history, forecasts, and ratios, supporting in-depth single-company analysis as well as cross-industry and cross-market comparisons.

Asset mapping & comparison

Structured mapping from thesis to named assets (strengths, weaknesses, peers, risks).

• Rockwool (ROCKb.CO)

  Research coverage target and stock covered with a Goldman Sachs Buy rating

  Strengths

  Leader in the rock wool category, with 2026 revenue guidance raised and considered achievable by Goldman Sachs; the short-term impact of energy costs is manageable, and capacity expansion supports earnings growth from 25-2030.

  Weaknesses

  The business is affected by the European cycle, interest rate environment, and energy and transportation costs; the France plant is expected to be delayed until 2029.

  Comparison

  The current roughly 14x 12-month forward P/E is below the 20-year average of 19x; the company may gain share relative to foam board competitors, as they face greater pressure from price increases.

  Risks

  Capex overruns, continued investment in projects with weak business cases, increased competitor supply, new supply causing pricing contribution to turn negative, and a weaker-than-expected European cycle.

Key data

• Report date2026-05-20The report was published at 7:22PM BST.
• 12-month target priceDKK 230Previously DKK 232, lowered by about 1% this time.
• Current priceDkr190.60Price disclosed in the cover page key data.
• Implied upsideabout 20.7%Roughly calculated using the DKK 230 target price and the current price of Dkr190.60, excluding dividends.
• Market capitalizationDkr40.3bn / $6.3bnCover page key data.
• Enterprise valueDkr43.8bn / $6.8bnCover page key data; net debt and enterprise value metrics include leases.
• 3-month average daily trading valueDkr100.7mn / $15.7mnCover page key data.
• 2026 revenue growth guidance+3%-6%Previous guidance was +2%-4%.
• 2Q26 EBIT forecast€133mnGoldman Sachs expects it to be flat year-on-year.
• 2Q26 volume forecast+2%Goldman Sachs expects 2Q trading to continue the improvement seen in March.
• 2H26 volume forecast-1%Goldman Sachs believes the company's guidance does not embed a continuation of 2H improvement, reflecting cautious assumptions.
• Target mid-year price increase+6%-8%Used to offset pressure from energy and transportation costs.
• 25-2030 earnings CAGR+7%Goldman Sachs says it is mainly driven by capacity expansion.
• FY26/27/28E EPS revision+0%/+2%/-3%Mainly reflects the delay in commissioning new capacity in France, with limited impact on 2026.
• M&A score3Low-probability category, 0%-15%, usually not included in the target price.

Impact & implications

If 2Q26 trading momentum, mid-year price increases, and capacity ramp-up materialize, Rockwool's discounted valuation may be re-rated; in the near term, 2026 guidance is solid and 2H assumptions are conservative, leaving some room for earnings upside. Constraints include the European demand cycle, competitive supply, pricing pressure, and execution risk on new capacity.

Risks

• Capex overruns on new capacity.
• Continued investment in projects with weak business cases.
• Increased competitor supply.
• New supply coming online causes pricing contribution to turn negative.
• The European cycle is weaker than expected.
• If energy and transportation costs cannot be fully passed through via price increases, margins may come under pressure.
• The delay of the France plant startup to 2029 may affect the pace of capacity release in subsequent years.

What to watch

• Whether 2Q26 trading momentum and volume reach Goldman Sachs' +2% expectation.
• Whether the mid-year +6%-8% price increase can offset energy and transportation cost pressure.
• Whether 2H26 volume is weaker or better than Goldman Sachs' cautious -1% assumption.
• The progress of capacity ramp-up in the U.S. and other non-European regions.
• Whether capital discipline continues as new capacity projects in Europe are postponed to after 2030.
• Progress on the approximately €40mn Hungary acquisition and EU industry consolidation.
• Management signals released at Rockwool's London CFO roadshow on June 9.