[ULS] UL Solutions Thesis 2026: Post-IPO Safety Testing Drives EV Plus Renewables Cycle
Key Takeaways
- UL Solutions Inc. (NYSE: ULS) FY2025 revenue
$3.0-3.2B (+8-12% YoY) with adj. EPS$0.3-0.4B; +12-18%) + selected continued post-2024 ~$0.4 annual dividend + ~$200-300M aggregate FY2024-2025 buyback program execution under continued President + CEO Jennifer Scanlon (~7-year tenure since November 2018; ex-USG Corporation CEO 2016-2018 + ex-various USG + Carlson Wagonlit Travel + ~25-year industry career; selected first female UL Solutions CEO).$1.50-1.75 reflecting continued post-April 2024$1.0-1.1B; +5-9%) + Software & Advisory ($1.0B aggregate NYSE IPO + selected post-2024 Industrial ($1.7-1.8B; +10-13%) selected major safety testing + certification + selected various services + selected post-2024 Consumer ( - Post-April 2024 NYSE IPO + safety testing leadership: post-April 2024 NYSE IPO ($1.0B aggregate; ~32M shares at ~$28-31/share initial pricing range; selected major safety science + testing + certification IPO); selected post-2024 ULSE Inc. → UL Solutions Inc. rebrand reflecting selected post-IPO public-facing positioning; selected continued ~120-year heritage Underwriters Laboratories certification mark (selected major US + global safety standard).
- EV + Renewables testing cycle: selected major Industrial segment
$1.7-1.8B FY2025 revenue (+10-13% YoY); selected continued post-2024 EV battery + EV charging + selected various electric vehicle safety testing + selected post-2024 selected various solar PV + battery storage + wind + selected various renewables safety testing + selected continued 5G + selected various technology testing. - Capital return:
$0.4 annual dividend FY2025 ($0.10/quarter; selected ~+0% growth post-2024$0.4); selected modest opportunistic buybacks ($200-300M aggregate FY2024-2025 buyback program); ~$280-380M aggregate FY2025 capital return; selected post-IPO net cash position ~$0.5-0.7B; investment-grade Baa3/BBB- credit rating; selected ~80%+ ULSE Inc. (UL Standards & Engagement; ULSE non-profit holding company) aggregate ownership control via dual-class share structure; FY2026 catalyst: continued post-2024 capital deployment + selected potential dividend acceleration.
Company Background
UL Solutions Inc. (NYSE: ULS; previously ULSE Inc. through April 2024) is a global safety science + testing + certification + selected various provider with FY2025 revenue ~$3.0-3.2B (+8-12% YoY) and adj. EPS ~$1.50-1.75 reflecting continued post-April 2024 NYSE IPO + selected post-2024 Industrial + Consumer + Software & Advisory segment growth. The company employs ~15,000+ globally with operations across selected ~110+ aggregate testing laboratories + selected various offices in 44+ countries.
Founded 1894 as Underwriters Electrical Bureau (UEB) in Chicago Illinois (~131-year heritage; selected one of US oldest continuing safety testing organizations); selected post-1901 Underwriters Laboratories Inc. rebrand following selected various consolidation; selected post-1990s aggregate selected various commercial expansion; selected post-2012 Underwriters Laboratories Inc. → UL LLC + UL Standards & Engagement (ULSE) corporate restructuring (selected for-profit + non-profit separation); selected post-November 2018 Jennifer Scanlon CEO appointment; selected post-2022 ULSE Inc. holding company formation; selected post-April 2024 NYSE IPO ($1.0B aggregate; ~32M shares at ~$28-31/share); selected post-April 2024 ULSE Inc. → UL Solutions Inc. rebrand reflecting selected post-IPO public-facing positioning; selected ~80%+ ULSE Inc. (UL Standards & Engagement; ULSE non-profit holding company) aggregate ownership control via dual-class share structure post-IPO.
Headquartered in Northbrook Illinois (selected continued post-1901 Chicago area HQ); ~15,000+ employees globally with ~$3.0-3.2B revenue. Three primary business segments: Industrial (~55% revenue ~$1.7-1.8B — selected major safety science + testing + certification covering selected various electric vehicle + battery + renewables + 5G + selected various industrial safety testing), Consumer (~35% ~$1.0-1.1B — selected various consumer product safety + selected various consumer testing + certification), Software & Advisory (~10% ~$0.3-0.4B — selected post-2024 software + advisory + selected various). Geographic mix: Americas ~55% + Europe + Middle East + Africa ~25% + Asia Pacific ~20%.
President + CEO Jennifer Scanlon since November 2018 (~7-year tenure; selected first female UL Solutions CEO); succeeded Keith Williams (CEO 2005-November 2018 retired); Scanlon ex-USG Corporation CEO 2016-2018 + ex-various USG + Carlson Wagonlit Travel + ~25-year industry career; selected continued strategic priorities include post-April 2024 NYSE IPO operational execution + selected post-2024 EV + renewables + selected various technology testing growth + selected various M&A capacity. CFO Ryan Robinson (since post-2022); selected ULSE non-profit ~80%+ aggregate ownership.
Post-April 2024 NYSE IPO + Safety Testing Leadership
UL Solutions post-April 2024 NYSE IPO + selected ~120-year safety testing leadership:
- IPO size: $1.0B aggregate (~32M shares at ~$28-31/share initial pricing range)
- Selected post-IPO transition: ULSE Inc. → UL Solutions Inc. rebrand
- ~120-year heritage: continued ~131-year continuous Underwriters Laboratories certification mark; selected major US + global safety standard
- Testing laboratories: ~110+ aggregate testing laboratories + selected various offices in 44+ countries
- Selected ~80%+ ULSE non-profit ownership: continued post-IPO dual-class share structure ULSE non-profit ownership control
FY2026 catalyst: continued post-IPO operational execution + selected potential post-2024 capital deployment.
EV + Renewables Testing Cycle
UL Solutions Industrial segment ~$1.7-1.8B FY2025 revenue (~55% revenue mix; +10-13% YoY):
- Electric vehicle (EV) testing: selected major EV battery + EV charging + selected various electric vehicle safety testing
- Renewables testing: selected post-2024 selected various solar PV + battery storage + wind + selected various renewables safety testing
- 5G + technology testing: selected continued 5G + selected various technology testing
- Selected various Industrial: selected continued post-2024 selected various industrial safety testing
- Selected continued post-2024 EV cycle: continued post-2024 selected various automotive OEM EV safety testing
FY2026 catalyst: continued EV + renewables testing cycle + ~$0.10-0.20 incremental annual EPS contribution.
Consumer + Software & Advisory
UL Solutions Consumer + Software & Advisory segments:
- Consumer (~35% revenue ~$1.0-1.1B): ~+5-9% growth FY2025; selected various consumer product safety + selected various consumer testing + certification
- Software & Advisory (~10% revenue ~$0.3-0.4B): ~+12-18% growth FY2025; selected post-2024 software + advisory + selected various
- Selected post-2024 selected various M&A: continued post-2024 selected various tuck-in M&A capacity
- Selected continued post-2024 cyclical recovery: continued post-2024 selected various Consumer + Software & Advisory
FY2026 catalyst: continued Consumer + Software & Advisory + ~$0.10-0.20 incremental EPS contribution.
Capital Return Framework
UL Solutions capital return framework:
- Ordinary dividend:
$0.4 annual FY2025 ($0.10/quarter; selected ~+0% growth post-2024 ~$0.4) - Buybacks: ~$200-300M aggregate FY2024-2025 buyback program
- Aggregate capital return: ~$280-380M FY2025
- Net cash position: ~$0.5-0.7B FY2025
- ULSE non-profit ownership: ~80%+ aggregate ownership control via dual-class share structure
FY2026 catalyst: continued capital deployment + selected potential post-2024 dividend acceleration.
Risks
- Post-IPO performance: continued post-April 2024 IPO trading performance
- EV + renewables cycle: continued EV + renewables testing cycle sustainability
- Selected various competitive intensity: SGS + Bureau Veritas + Intertek Group + selected various testing + certification competition
- ULSE non-profit ownership: ~80%+ ULSE non-profit ownership concentration via dual-class share structure
- Currency: USD/EUR + USD/CNY + selected various international currency volatility
Key Core Metrics
| Metric | FY2025 | FY2024 | FY2023 | FY2022 | FY2026 outlook |
|---|---|---|---|---|---|
| Revenue | $3.0-3.2B | $2.78B | $2.68B | $2.52B | $3.3-3.5B |
| Adj. EBITDA | $620-680M | $560M | $510M | $450M | $700-770M |
| Adj. EPS | $1.50-1.75 | $1.30 | $0.95 | $0.45 | $1.75-2.10 |
| Adj. EBITDA margin | 20-22% | 20% | 19% | 18% | 21-23% |
| FCF | $300-400M | $290M | $235M | $190M | $360-470M |
| Capital return | FY2025 | FY2024 | FY2026 outlook |
|---|---|---|---|
| Dividend | $0.4 | $0.4 | $0.4-0.5 |
| Buybacks | $100-200M | $100M | $150-250M |
| Total return | $280-380M | $280M | $300-400M |
| Net cash | $0.5-0.7B | $0.6B | $0.6-0.8B |
Market Evaluation
UL Solutions trades at selected ~30-40x FY2026 P/E premium vs SGS (~22-26x) + Bureau Veritas (~22-26x) + Intertek Group (~22-26x) + selected various testing + certification peers reflecting selected post-April 2024 NYSE IPO + selected ~131-year heritage Underwriters Laboratories certification mark + selected continued post-2024 EV + renewables testing cycle + selected ~80%+ ULSE non-profit ownership concentration. Selected re-rating catalysts include: (1) continued EV + renewables testing cycle + ~+10-13% Industrial growth; (2) Consumer + Software & Advisory continued growth; (3) post-IPO operational execution; (4) ~$280-380M aggregate annual capital return; (5) selected potential post-2024 dividend acceleration.
Post-IPO + EV Testing Strategic Differentiation Deep Dive
UL Solutions post-April 2024 NYSE IPO + EV + renewables testing cycle represents selected primary strategic differentiation thesis vs traditional testing + certification peers (SGS + Bureau Veritas + Intertek Group + selected various). Selected ~131-year heritage Underwriters Laboratories certification mark (selected major US + global safety standard since 1894 founding) supports selected continued safety testing brand leadership + selected ~110+ aggregate testing laboratories + selected various offices in 44+ countries. Selected post-April 2024 NYSE IPO ($1.0B aggregate; ~32M shares at ~$28-31/share) marks selected major transition from selected pre-IPO non-profit Underwriters Laboratories to selected combined ULSE Inc. (ULSE non-profit holding company) + UL Solutions Inc. (post-IPO public for-profit testing entity) corporate structure. Selected ~$1.7-1.8B Industrial segment revenue (~55% revenue mix; ~+10-13% YoY) reflects selected continued post-2024 EV battery + EV charging + selected various electric vehicle safety testing + selected post-2024 selected various solar PV + battery storage + wind + selected various renewables safety testing + selected continued 5G + technology testing supporting selected continued FY2026-2028 Industrial cycle. FY2026 catalyst: continued post-IPO + EV cycle + ~$0.10-0.20 incremental annual EPS contribution.
FY2026 thesis: Post-April 2024 NYSE IPO + EV + renewables testing cycle + Consumer + Software & Advisory continued growth + ~$280-380M aggregate annual capital return + selected continued ~80%+ ULSE non-profit ownership.