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Relative valuation derived from Industrials sector median benchmarks. Model weights: EV/EBITDA (40%), P/B (35%), P/S (25%). Multiples adjusted for extreme outliers and non-recurring volatility.
Auditing capital efficiency...
Quality Profile Audit
Score: 43.8GRADE C
Composite assessment of profitability, capital efficiency, and financial strength. Top-tier entities demonstrate sustainable cash flow generation.
Return on Equity
Profit generated per dollar of shareholder equity
28.4%
Sector: 8.9%
Dividend Analysis audit
GROWTH
0.73%
Trailing Yield
$0.73
Per $100 Invested
Modest dividend — capital prioritized for reinvestment.
Est. Payout Ratio
33%SAFE
Analyst Projections
Analyst Consensus
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Based on our 6-factor quantitative model, UL Solutions Inc. (ULS) receives a "Hold" rating with a composite score of 47.2/100, ranked #753 out of 4446 stocks. Key factor scores: Quality 44/100, Value 51/100, Momentum 61/100. This is quantitative analysis only — not investment advice.
UL Solutions Inc. (ULS) Stock Analysis — April 2026 Rating, Price, and Forecast
Company Overview — What Does UL Solutions Inc. Do?
We work for a safer world. Our mission drives our actions, inspires our employees and is the key to our success. We strive to be our customers’ most trusted science-based safety, security and sustainability partner. We are a global safety science leader that provides independent testing, inspection and certification (“TIC”) services and related software and advisory (“S&A”) offerings to customers worldwide. Our history dates back to our founding in 1894 as part of the nonprofit Underwriters Electrical Bureau, a predecessor to UL Research Institutes, UL Standards & Engagement and UL Solutions. As the largest TIC services provider headquartered in North America (by revenue) with a global network of laboratories, we provided a comprehensive set of product safety, security and sustainability solutions to more than 80,000 customers across over 110 countries in 2023. Our distinguished heritage and our long history of operating at the forefront of safety science enables us to achieve and maintain more than 650 technical accreditations and 83 commercial software solutions, and to remain active in over 1,300 standards panels and technical committees globally, which underpins the expertise we offer to our customers. Furthermore, we offer over 450 independent third-party conformity assessment services around the world and are capable of testing and certifying against over 4,000 global standards, which affords us vast insight into the safety of products across a wide range of end markets and geographies. We are the owner of the iconic UL-in-a-circle certification mark (“UL Mark”) that appears on billions of products around the world. We offer our customers global market access services that help them ensure the safety and quality of their products while also supporting their efforts to manage the broader risks they face throughout their product lifecycle processes. We believe our extensive knowledge of, and expertise in, global safety science provides us with a strong competitive advantage relative to other global TIC service providers. People are at the core of who we are and what we do for our customers. Our technical team of more than 9,900 scientists, engineers and other specialized technical and regulatory experts has been nurtured and developed over many years and is a differentiator of our business. This deep and highly trained talent pool, and our strong technical laboratory capabilities, enable us to serve as a trusted and independent partner to our diverse array of global customers. We serve our customers through two complementary businesses, TIC and S&A. Our TIC business is made up of two segments, Industrial and Consumer, which provide comprehensive testing, inspection and certification services to customers across a broad array of end markets. Our S&A business is a global provider of software, data and advisory solutions, enabling our customers to manage complex regulatory requirements, deliver supply chain transparency and operationalize sustainability. We generate revenue in these segments and the following service categories: Certification Testing; Ongoing Certification Services; Non-certification Testing and Other Services; and Software. As the global economy continues to evolve and becomes more digital and inter-connected, our customers continue to seek ways to bridge traditional TIC needs with next generation cloud-based software and services to better mitigate risk and enhance their business performance. We believe that our complementary TIC and S&A offerings position us to capitalize on this market need and better serve our customers, of which we had more than 80,000 in 2023. In 2023, approximately 70% of our global and strategic accounts utilized both TIC and S&A services. The scope of our global and strategic accounts is primarily based on two factors: (1) each customer’s current spend with us and (2) an estimate of each such customer’s potential future spend with us. The scope is then further revised based on regional priorities, emerging trends and recent changes in each customer’s spend. Given the nature of our services, we are continuously engaging and working side-by-side with our customers. On any given day, throughout the world, our teams can be found in more than 1,500 of our customers’ global manufacturing locations inspecting products, facilities, processes and systems and interacting with our customers. Similarly, many of our customers spend time in our laboratories observing the testing of their products, or spend time in their workplaces using our proprietary software and material and chemical databases to share information across their value chains. Our strong customer relationships, coupled with the essential nature of our core testing, inspection and certification services, drive high customer retention; in 2023, we achieved an approximately 99% customer retention rate amongst our 500 largest customer accounts from each of 2019, 2020, 2021 and 2022. We calculate our customer retention rate as the percentage of our top 500 customers in a given year that generate revenue with us in subsequent years, and we measure this metric at the parent level; therefore, a customer for this purpose may be comprised of several subsidiaries and independent businesses. Our attractive business model has allowed us to deliver a long track record of stable growth and profitability. Underlying demand for our services is largely driven by a combination of regulatory requirements and evolving customer and consumer preferences, providing strong stability and visibility to our financial profile. We have made significant investments in our people, laboratories and digital capabilities over many decades, allowing us to execute our growth strategy and meet the increasingly complex needs of our customers. We supplement our organic growth with acquisitions, having successfully completed and integrated 54 acquisitions since 2010. As a result of our organic and inorganic growth, we are the number one TIC services provider for products and a top ten TIC provider globally as measured by revenue, with a compound annual revenue growth rate of approximately 7% over the last 12 years. --- In 1894, William Henry Merrill, Jr. founded Underwriters Electrical Bureau, an electrical testing laboratory to insurance underwriters. In 1901, Underwriters Laboratories, the predecessor to UL Research Institutes, was incorporated in the state of Illinois as a nonprofit organization dedicated to the promotion of safety standards, publishing its first standard in 1903, “Tin Clad Fire Doors.” The first UL Mark for use outside of the United States was introduced in 1992 for the Canadian market. For 130 years, UL Research Institutes has engaged, including through controlled affiliates, in four principal activities: (1) conducting and disseminating scientific research on public safety issues, (2) engaging in education and outreach activities to promote public safety, (3) developing standards for public safety and (4) testing, inspecting and certifying products to safety standards. UL Solutions Inc., the registrant, was incorporated as Underwriters Laboratories (USA) Inc. in 2008 and changed its name to UL Inc. in 2011. In 2012, UL Research Institutes transferred its testing, inspection and certification activities to UL Inc. In 2021, UL Research Institutes transferred its Standards Activities to UL Standards & Engagement, pursuant to the Reorganization, and on June 16, 2022, the Company filed an amendment to its restated certificate of incorporation changing the Company’s name to UL Solutions Inc. UL Research Institutes remains a tax-exempt nonprofit organization and continues to engage in scientific research activities. UL Solutions Inc. remains an indirect subsidiary of UL Research Institutes, with the same goal of advancing public safety. Our corporate headquarters are located at 333 Pfingsten Road, Northbrook, Illinois 60062. UL Solutions Inc. (ULS) is classified as a large-cap stock in the Industrials sector, specifically within the Business Services industry. The company is led by CEO Jennifer F. Scanlon, headquartered in NORTHBROOK, Illinois. With a market capitalization of $17.0B, ULS is one of the prominent companies in the Industrials sector.
UL Solutions Inc. (ULS) Stock Rating — Hold (April 2026)
As of April 2026, UL Solutions Inc. receives a Hold rating with a composite score of 47.2/100 and 3 out of 5 stars from the Blank Capital Research quantitative model.ULS ranks #753 out of 4,446 stocks in our coverage universe. Within the Industrials sector, UL Solutions Inc. ranks #128 of 752 stocks, placing it in the top quartile of its Industrials peers. The rating is generated by a multi-factor model that weighs quality (30%), momentum (25%), value (15%), investment (10%), stability (10%), and short interest (10%).
ULS Stock Price and 52-Week Range
UL Solutions Inc. (ULS) currently trades at $84.32. The stock lost $0.17 (0.2%) in the most recent trading session. The 52-week high for ULS is $91.95, which means the stock is currently trading -8.3% from its annual peak. The 52-week low is $49.93, putting the stock 68.9% above its annual trough. Recent trading volume was 461K shares, suggesting relatively thin trading activity.
Is ULS Overvalued or Undervalued? — Valuation Analysis
UL Solutions Inc. (ULS) carries a value factor score of 51/100 in the Blank Capital model, indicating fair valuation relative to historical norms. The trailing price-to-earnings ratio is 44.88x, compared to the Industrials sector average of 28.33x — a premium of 58%. The price-to-book ratio stands at 12.76x, versus the sector average of 2.23x. The price-to-sales ratio is 5.51x, compared to 0.50x for the average Industrials stock. On an enterprise value basis, ULS trades at 31.85x EV/EBITDA, versus 5.70x for the sector. The EV/EBIT multiple is 33.48x.
Overall, ULS's valuation appears roughly in line with sector benchmarks, suggesting the market is pricing the stock fairly given its current fundamentals and growth trajectory. Neither deep value nor significantly overpriced, the stock occupies a middle ground on valuation.
UL Solutions Inc. Profitability — ROE, Margins, and Quality Score
UL Solutions Inc. (ULS) earns a quality factor score of 44/100, signaling below-average profitability metrics relative to the broader market. The return on equity (ROE) is 28.4%, compared to the Industrials sector average of 8.9%, which demonstrates strong shareholder value creation. Return on assets (ROA) comes in at 12.6% versus the sector average of 3.3%.
On a margin basis, UL Solutions Inc. reports gross margins of 49.3%, compared to 35.8% for the sector. The operating margin is 17.8% (sector: 6.2%). Net profit margin stands at 12.2%, versus 3.9% for the average Industrials stock. Revenue growth is running at 7.3% on a trailing basis, compared to 6.4% for the sector. Profitability is below benchmark levels, which may reflect industry headwinds, elevated reinvestment, or structural challenges.
ULS Debt, Balance Sheet, and Financial Health
UL Solutions Inc. has a debt-to-equity ratio of 38.0%, compared to the Industrials sector average of 70.0%. The low leverage indicates a conservative balance sheet with significant financial flexibility. The current ratio is 1.32x, suggesting adequate working capital coverage. Total debt on the balance sheet is $491M. Cash and equivalents stand at $255M.
ULS has a beta of 1.05, meaning it is roughly in line with the broader market in terms of price volatility. The stability factor score for UL Solutions Inc. is 71/100, indicating low-volatility characteristics and consistent price behavior that appeals to risk-averse investors.
UL Solutions Inc. Revenue and Earnings History — Quarterly Trend
In TTM 2026, UL Solutions Inc. reported revenue of $3.00B and earnings per share (EPS) of $1.62. Net income for the quarter was $368M. Gross margin was 49.3%. Operating income came in at $534M.
In FY 2025, UL Solutions Inc. reported revenue of $3.05B and earnings per share (EPS) of $1.62. Net income for the quarter was $345M. Gross margin was 49.5%. Revenue grew 6.4% year-over-year compared to FY 2024. Operating income came in at $522M.
In Q3 2025, UL Solutions Inc. reported revenue of $783M and earnings per share (EPS) of $0.50. Net income for the quarter was $106M. Gross margin was 50.3%. Revenue grew 7.1% year-over-year compared to Q3 2024. Operating income came in at $156M.
In Q2 2025, UL Solutions Inc. reported revenue of $776M and earnings per share (EPS) of $0.45. Net income for the quarter was $97M. Gross margin was 49.4%. Revenue grew 6.3% year-over-year compared to Q2 2024. Operating income came in at $139M.
Over the past 8 quarters, UL Solutions Inc. has demonstrated a growth trajectory, with revenue expanding from $730M to $3.00B. Investors analyzing ULS stock should weigh these quarterly trends alongside the valuation and quality metrics discussed above.
ULS Dividend Yield and Income Analysis
UL Solutions Inc. (ULS) currently pays a dividend yield of 0.7%. At this yield, a $10,000 investment in ULS stock would generate approximately $$73.00 in annual dividend income. The net margin of 12.2% provides reasonable coverage for the dividend, though investors should monitor payout sustainability.
ULS Momentum and Technical Analysis Profile
UL Solutions Inc. (ULS) has a momentum factor score of 61/100, reflecting neutral trend characteristics. The stock is neither significantly outperforming nor underperforming the broader market on a momentum basis. The investment factor score is 30/100, which measures capital allocation efficiency and asset growth patterns. The short interest score of 10/100 signals elevated short interest, which can indicate bearish sentiment among institutional investors.
ULS vs Competitors — Industrials Sector Ranking and Peer Comparison
Comparing ULS against the S&P 500 benchmark is also instructive for understanding relative performance. Investors can view the full ULS vs S&P 500 (SPY) comparison to assess how UL Solutions Inc. stacks up against the broader market across all factor dimensions.
ULS Next Earnings Date
No upcoming earnings date has been announced for UL Solutions Inc. (ULS) at this time. Check the earnings calendar for the latest scheduling updates across all stocks in our coverage universe.
Should You Buy ULS? — Investment Thesis Summary
UL Solutions Inc. presents a balanced picture with arguments on both sides. Price momentum is positive at 61/100, suggesting the trend favors buyers. Low volatility (stability score 71/100) reduces downside risk.
In summary, UL Solutions Inc. (ULS) earns a Hold rating with a composite score of 47.2/100 as of April 2026. The rating is derived from the Blank Capital Research methodology, which combines six factor dimensions into a single quantitative ranking. Investors should consider these quantitative signals alongside their own fundamental research, risk tolerance, and investment time horizon before making buy or sell decisions on ULS stock.
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Institutional Research Dossier
UL Solutions Inc. (ULS) Deep Dive Analysis
Published on March 24, 2026
Action RatingHold
Sections
Executive Summary
We maintain a Hold rating on UL Solutions Inc. (ULS). While the company benefits from a strong brand, high customer retention, and a leading position in the testing, inspection, and certification (TIC) industry, its current valuation appears stretched relative to its growth prospects and sector peers. The company's ability to sustain its historical growth rate and successfully integrate acquisitions will be critical in justifying its premium valuation.
ULS operates in a resilient industry driven by regulatory requirements and evolving consumer preferences, providing a degree of stability. However, the high P/E ratio and EV/EBITDA multiple compared to the industrials sector suggest that much of the company's future growth is already priced into the stock. Investors should closely monitor ULS's ability to maintain its margins, generate free cash flow, and navigate increasing competition within the TIC sector.
Business Strategy & Overview
UL Solutions operates as a global safety science leader, providing independent testing, inspection, and certification (TIC) services, along with related software and advisory (S&A) offerings. The company's revenue is generated through its TIC business, which is divided into Industrial and Consumer segments, and its S&A business, which offers software, data, and advisory solutions. ULS's strategy revolves around leveraging its long history, technical expertise, and global network of laboratories to serve a diverse customer base across various end markets.
The company's strategic positioning is built upon its reputation for independence, scientific rigor, and adherence to safety standards. ULS aims to be its customers' most trusted partner in ensuring product safety, security, and sustainability. This is achieved through a combination of rigorous testing processes, adherence to over 4,000 global standards, and the iconic UL Mark, which signifies product safety and compliance. The company actively participates in over 1,300 standards panels and technical committees, further solidifying its expertise and influence within the industry.
ULS focuses on integrating its TIC and S&A offerings to provide comprehensive solutions that address the evolving needs of its customers. The company recognizes the increasing demand for cloud-based software and services that complement traditional TIC needs. By offering both testing and software solutions, ULS aims to enhance its customers' ability to manage regulatory requirements, improve supply chain transparency, and operationalize sustainability initiatives. The company's high customer retention rate, particularly among its largest accounts, indicates the success of this integrated approach.
The company supplements its organic growth with strategic acquisitions, having completed 54 acquisitions since 2010. These acquisitions allow ULS to expand its service offerings, enter new markets, and enhance its technological capabilities. Successful integration of these acquisitions is crucial for maintaining growth momentum and achieving synergies. ULS's ability to continuously adapt to evolving industry trends, such as the increasing importance of sustainability and cybersecurity, will be critical for its long-term success.
Execution Benchmarks audit
Revenue Growth
YOY expansion rate
7.3%
Sector: 6.4%
+14% VS SCTR
Economic Moat Analysis
UL Solutions possesses a narrow economic moat, primarily derived from its intangible assets and high customer switching costs. The UL Mark, a globally recognized symbol of product safety and compliance, represents a significant intangible asset. This brand recognition provides ULS with a competitive advantage, as manufacturers often seek UL certification to demonstrate the safety and quality of their products to consumers and regulators. The company's long history and reputation for independence further enhance the value of its brand.
High customer switching costs also contribute to ULS's moat. Obtaining certifications and approvals from testing agencies is a complex and time-consuming process. Once a manufacturer has established a relationship with ULS and integrated its testing and certification processes, switching to a different provider can be costly and disruptive. This creates a degree of customer stickiness, as evidenced by the company's high customer retention rate among its largest accounts.
While ULS benefits from these moat sources, the TIC industry is becoming increasingly competitive. Other large TIC providers, such as SGS, Bureau Veritas, and Intertek, offer similar services and have established global networks. These competitors are investing in technology and expanding their service offerings, which could erode ULS's competitive advantage over time. The company's ability to maintain its brand reputation, innovate its service offerings, and adapt to evolving customer needs will be crucial for preserving its moat.
The network effect is not a significant driver of ULS's moat. While the company's extensive network of laboratories and technical experts provides a competitive advantage, it does not create a self-reinforcing cycle of increasing value for customers. The value of ULS's services is primarily derived from its expertise, independence, and adherence to safety standards, rather than the size or interconnectedness of its network.
Financial Health & Profitability
UL Solutions has demonstrated a track record of stable revenue growth and profitability. The company's revenue has grown at a compound annual growth rate of approximately 7% over the last 12 years, driven by a combination of organic growth and acquisitions. The recent quarterly financial history shows consistent revenue growth, with revenue increasing from $670 million in Q1 2024 to $783 million in Q3 2025. This growth reflects the underlying demand for TIC services, which is driven by regulatory requirements and evolving consumer preferences.
The company's gross margins are strong, consistently hovering around 48-50%. This indicates ULS's ability to maintain pricing power and manage its cost of goods sold effectively. Operating margins have also been healthy, ranging from 13.6% to 19.9% in recent quarters. These margins are significantly higher than the industrials sector average, reflecting ULS's strong competitive position and efficient operations. Net income has also shown consistent growth, with net income for FY2025 at $345 million, the same as FY2024, but higher than FY2023's $276 million.
ULS's balance sheet appears to be reasonably healthy. The company has a current ratio of 1.32, indicating its ability to meet its short-term obligations. Total debt of $491 million is manageable relative to the company's EBITDA of $522 million, resulting in a debt-to-EBITDA ratio of less than 1. The debt-to-equity ratio of 38.00 is also lower than the industrials sector average, suggesting a conservative approach to leverage.
Free cash flow generation has been volatile in recent years. While the company generated $268.17 million in free cash flow in the latest TTM period, it experienced negative free cash flow in FY2023 and Q1 2024. This volatility may be due to investments in acquisitions and infrastructure. Consistent free cash flow generation is crucial for ULS to fund future growth initiatives and return capital to shareholders. Investors should monitor the company's ability to improve its free cash flow generation in the coming quarters.
Valuation Assessment
UL Solutions' valuation appears elevated compared to its sector peers. The company's P/E ratio of 51.1x is significantly higher than the industrials sector average of 27.7x. Similarly, its EV/EBITDA multiple of 8.2x is higher than the sector average of 5.7x. This suggests that investors are pricing in significant future growth for ULS.
The company's high ROE of 28.4% justifies a premium valuation to some extent. However, it is important to consider whether ULS can sustain this high level of profitability in the long term. Increasing competition and potential margin pressure could impact the company's ROE and, consequently, its valuation.
Given the company's historical revenue growth rate of approximately 7%, the current valuation implies a high price-to-growth (PEG) ratio. This suggests that the stock may be overvalued relative to its growth prospects. Investors should carefully consider whether ULS can accelerate its growth rate or maintain its high margins to justify its premium valuation.
A discounted cash flow (DCF) analysis would be necessary to determine a more precise fair value for ULS. However, based on the available data, it appears that the stock is currently trading at a premium to its intrinsic value. The Hold rating reflects the view that the stock's current valuation is not attractive, given its growth prospects and the risks associated with the TIC industry.
Risk & Uncertainty
UL Solutions faces several risks that could impact its future performance. One significant risk is increasing competition within the TIC industry. As the industry becomes more consolidated, ULS faces greater pressure from larger, well-capitalized competitors. These competitors may offer lower prices or more comprehensive service offerings, which could erode ULS's market share and margins.
Regulatory changes also pose a risk to ULS. The company's business is heavily influenced by safety standards and regulations. Changes in these regulations could require ULS to adapt its testing and certification processes, which could be costly and time-consuming. Furthermore, the emergence of new technologies and industries could require ULS to develop new testing capabilities, which could strain its resources.
Acquisition integration risk is another concern. ULS has a history of acquiring companies to expand its service offerings and enter new markets. However, integrating these acquisitions can be challenging, and there is no guarantee that ULS will be able to achieve the expected synergies. Failure to successfully integrate acquisitions could negatively impact the company's financial performance.
A potential economic slowdown could also negatively impact ULS's business. Demand for TIC services is correlated with economic activity. A recession or slowdown in global economic growth could reduce demand for ULS's services, leading to lower revenue and profitability. The company's ability to navigate economic downturns will be crucial for its long-term success.
Bulls Say / Bears Say
The Bull Case
BULL VIEWUL Solutions' strong brand recognition and reputation for independence provide a significant competitive advantage, driving high customer retention and stable revenue growth.
BULL VIEWThe company's integrated TIC and S&A offerings position it to capitalize on the increasing demand for comprehensive risk management solutions, enhancing its long-term growth prospects.
BULL VIEWUL Solutions' consistent profitability and strong balance sheet provide a solid foundation for future acquisitions and investments in new technologies, further strengthening its market position.
The Bear Case
BEAR VIEWUL Solutions' high valuation relative to its growth rate and sector peers suggests that the stock is overvalued, leaving limited upside potential for investors.
BEAR VIEWIncreasing competition within the TIC industry could erode UL Solutions' market share and margins, negatively impacting its financial performance.
BEAR VIEWVolatile free cash flow generation and potential acquisition integration challenges pose risks to UL Solutions' ability to fund future growth initiatives and return capital to shareholders.
About the Author
Marques Blank
Founder & Chief Investment Officer, Blank Capital
Marques brings 15 years of institutional finance and investing experience, having overseen financial planning for a $1.6B defense business unit. He developed the proprietary 6-factor quantitative model used to score ULS and 4,400+ other equities.
UL Solutions Inc. exhibits a 498% valuation premium relative to institutional benchmarks. This represents a potential valuation overextension based on current multiples.
Return on Assets
Efficiency of asset utilization
12.6%
Sector: 3.3%
Gross Margin
Pricing power and cost efficiency
49.3%
Sector: 35.8%
Operating Margin
Core business profitability
17.8%
Sector: 6.2%
Net Margin
Bottom-line profitability
12.2%
Sector: 3.9%
Factor Methodology
The Quality factor evaluates the persistence and magnitude of cash flows. Companies with scores >70 exhibit superior competitive moats and financial resilience through economic cycles.
Sector Avg Yield0.00%
Yield Delta—
Income Projection audit
A $10,000 investment would generate approximately $73 annually in dividends at the current trailing rate.
