UL Solutions (ULS) Mixed 2Q as the Industrial business undergoes organic growth deceleration and margin contraction

Equity Research 4 August 2026 | 5:56PM PDT

UL Solutions (ULS) Mixed 2Q as the Industrial business undergoes organic growth deceleration and margin contraction

ULS 12m Price Target: $86.00 Price: $78.34 Upside: 9.8% NEUTRAL George K. Tong, CFA ULS shares have historically been bolstered primarily by the | Goldman Sachs & Co. LLC performance of the company’s Industrial segment, which combines Alex Lakritz defensiveness and exposure to secular tailwinds including | Goldman Sachs & Co. LLC electrification, automation, energy infrastructure and AI-related investment. While ULS continues to benefit from underlying demand Sami Nasir, CFA | Goldman Sachs & Co. LLC across power & controls, engineered materials, wire & cable and data center-related applications, 2Q marked an unexpected reversal from the pattern established in 1Q, as Industrial organic Key Data _____________________________________ Market cap: $16.0bn growth decelerated from 8.2% y/y to 7.2% despite easier comps due Enterprise value: $15.7bn 3m ADTV: $94.8mn to headwinds in the advisory business and segment EBITDA margins United States contracted 10 bps y/y due to compensation spend after expanding Americas Information and Business Services M&A Rank: 3 in the prior quarter. We expect shares to remain largely GS Forecast __________________________________ range-bound over the near-term as investors seek greater visibility 12/25 12/26E 12/27E 12/28E

into whether the moderation in Industrial growth reflects a Revenue ($ mn) New Revenue ($ mn) Old 3,053.0 3,053.0 3,220.7 3,226.7 3,429.4 3,440.3 3,681.7 3,680.1 temporary advisory-related issue and incentive compensation EBITDA ($ mn) ,032.5 EBIT ($ mn) timing dynamic, or the beginning of a more sustained slowdown. EPS ($) New Longer term, we continue to believe ULS can deliver at least EPS ($) Old P/E (X) mid-single-digit organic revenue growth supported by secular Dividend yield (%) 0.8 0.7 0.7 0.7 tailwinds, increasing exposure to AI and data center infrastructure, Net debt/EBITDA (X) 0.2 (0.3) (0.7) (1.0)

ongoing portfolio optimization and continued investment in testing 6/26 9/26E 12/26E 3/27E capacity. We also continue to see a path toward margin expansion EPS ($)

through operating leverage, productivity gains and restructuring GS Factor Profile ______________________________ Growth benefits, though note that the company expects acquisition and integration costs associated with the pending Eurofins E&E Financial Returns

acquisition to limit 2H margin expansion. Maintain Neutral. Multiple

2Q 2026 Financial Highlights Revenue outperforms consensus. Revenue of $816mn increased Percentile 20th 40th 60th 80th 100th

5.2% y/y, below our estimate of 5.9%, but above FactSet consensus ULS relative to Americas Coverage ULS relative to Americas Information and Business Services of 4.8%. On an organic basis, revenue grew 6.6% y/y, missing our forecast of 7.1% but surpassing consensus of 5.5%. By segment, Source: Company data, Goldman Sachs Research estimates. See disclosures for details. Industrial revenue increased 7.2% y/y organically, driven by strength in energy and automation, and materials. Consumer revenue grew

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Goldman Sachs UL Solutions (ULS)

UL Solutions (ULS) Balance Sheet ($ mn) _______________________________________ NEUTRAL Rating since May 7, 2024 12/25 12/26E 12/27E 12/28E Cash & cash equivalents ,119.3 Accounts receivable Inventory -- -- -- -- Ratios & Valuation __________________________________________ Other current assets /25 12/26E 12/27E 12/28E Total current assets 1,000.0 1,260.8 1,456.7 1,925.9 P/E (X) Net PP&E ,046.5 1,106.5 EV/EBITDA (X) Net intangibles EV/sales (X) 4.5 4.9 4.5 4.0 Total…