As global markets experience mixed results with a notable shift towards value stocks, the Netherlands' market presents unique opportunities for investors seeking undervalued assets. This article explores three stocks on Euronext Amsterdam that are estimated to be trading below their intrinsic value, potentially offering attractive entry points in the current economic climate.
Top 5 Undervalued Stocks Based On Cash Flows In The Netherlands
Overview: Alfen N.V. specializes in the design, engineering, development, production, and service of smart grids, energy storage systems, and electric vehicle charging equipment with a market capitalization of approximately €0.36 billion.
Operations: The company generates revenue through three primary segments: Smart Grid Solutions (€188.38 million), EV Charging Equipment (€153.12 million), and Energy Storage Systems (€162.98 million).
Estimated Discount To Fair Value: 32.6%
Alfen N.V., priced at €16.76, is significantly undervalued by 32.6% compared to a fair value estimate of €24.88, suggesting strong potential despite recent downward revisions in revenue guidance for 2024 from between €590 million to €660 million down to between €485 million and €500 million. While Alfen's profit margins have decreased from 12.1% last year to 5.9%, its earnings are expected to grow by approximately 20% annually over the next three years, outpacing the Dutch market forecast of 18.4%. This growth is supported by projections that Alfen's revenue will increase at an annual rate of about 12.8%, also above market averages.
Overview: Arcadis NV specializes in design, engineering, and consultancy services for natural and built assets across The Americas, Europe, the Middle East, and Asia Pacific, with a market capitalization of approximately €5.71 billion.
Operations: The company generates revenue through various segments, notably €1.95 billion from Resilience, €1.94 billion from Places, €978.80 million from Mobility, and €122.50 million from Intelligence.
Estimated Discount To Fair Value: 46.9%
Arcadis, priced at €63.45, is substantially undervalued, trading 46.9% below its estimated fair value of €119.5. Despite a high level of debt and slow revenue growth at 1.5% per year—lagging behind the Dutch market average—Arcadis' earnings are expected to increase significantly by about 20.48% annually over the next three years, outperforming the broader market's forecast of 18.4%. Recent contracts like leading Enterprise Decision Analytics for Henderson's asset management underline its strategic expansions in North America.
Overview: Envipco Holding N.V. operates in the environmental technology sector, specializing in the design, development, and servicing of reverse vending machines for recycling used beverage containers, primarily serving markets in the Netherlands, North America, and Europe with a market capitalization of approximately €337.49 million.
Operations: The company primarily generates revenue through the design, development, and servicing of reverse vending machines in the Netherlands, North America, and other parts of Europe.
Estimated Discount To Fair Value: 14.3%
Envipco Holding N.V., currently priced at €5.85, presents a compelling case as an undervalued stock based on cash flows, trading 14.3% below its estimated fair value of €6.83. The company has recently transitioned to profitability with a significant turnaround in earnings from a loss of €2.57 million to a net income of €0.147 million and is experiencing robust revenue growth at 33.3% annually—well above the market average. Despite this positive trajectory and expectations for continued high earnings growth (68.9% per year), the stock remains volatile, which may deter some investors.
This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
Companies discussed in this article include ENXTAM:ALFEN ENXTAM:ARCAD and ENXTAM:ENVI.
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