Alfen and two other stocks on Euronext Amsterdam are considered value picks

Against a backdrop of changing global economic indicators, the Dutch equity market remains a focus for value investors. Recent trends in international markets, including falling inflation rates and differentiated changes in monetary policy, have set the stage for a reassessment of investment opportunities at Euronext Amsterdam. In this context, identifying undervalued stocks such as Alfen is particularly important as they can represent attractive opportunities for those looking to take advantage of current market conditions.

The 5 most undervalued stocks in the Netherlands based on cash flows

Click here to see the full list of 6 stocks from our Undervalued Euronext Amsterdam Stocks Based on Cash Flows screener.

Below we present some of our favorites from our exclusive screener.

Overview: Alfen NV specializes in smart grids, energy storage systems and chargers for electric vehicles and has a market capitalization of around EUR 0.38 billion.

Operations: The company generates revenues in three main segments: Smart Grid Solutions (EUR 188.38 million), Electric Vehicle Chargers (EUR 153.12 million) and Energy Storage Systems (EUR 162.98 million).

Estimated discount to fair value: 29.3%

Alfen is considered undervalued at €17.59 on a DCF basis with a fair value of €24.89, suggesting significant upside potential. Although the 2024 revenue forecast was recently cut from €590-660 million to €485-500 million, Alfen’s profit is expected to grow 20.3% annually over the next three years – outperforming the Dutch market at 17.9%. However, return on equity is expected to remain low at 17.2% and profit margins have fallen to 5.9% from 12.1% last year.

Overview: Arcadis NV, a global company, provides design, engineering and consulting solutions for natural and built assets in the Americas, Europe, the Middle East and Asia Pacific with a market capitalization of approximately EUR 5.63 billion.

Operations: Arcadis generates its revenue in four main segments: Places (EUR 1.94 billion), Mobility (EUR 0.98 billion), Resilience (EUR 1.96 billion) and Intelligence (EUR 0.12 billion).

Estimated discount to fair value: 47.4%

Arcadis trades at €62.60 and is significantly undervalued based on a DCF valuation of €119.12, representing a significant discount to fair value. While the company’s revenue growth of 1.5% annually is slow compared to the Dutch market average of 9.6%, earnings are expected to grow strongly at 20.48% annually, beating the market forecast of 17.9%. Recent developments include securing a large digital asset management project in Henderson, Nevada, expanding the North American and public portfolio despite high debt and significant insider selling in the last quarter.

Overview: Envipco Holding NV specializes in the design, development, manufacture, assembly, marketing, sale, leasing and maintenance of reverse vending machines (RVMs) for recycling used beverage containers. The company operates mainly in the Netherlands, North America and other parts of Europe and has a market capitalization of approximately EUR 331.72 million.

Operations: Envipco Holding NV generates its revenue primarily through the development, production and maintenance of reverse vending machines in the Netherlands, North America and other European regions.

Estimated discount to fair value: 15.5%

Envipco Holding NV is trading at €5.75, 15.5% below its estimated fair value of €6.81, reflecting a slight undervaluation based on a cash flow analysis. Despite the dilution of shareholders’ shares last year and a very volatile share price, Envipco has turned profitable this year. First quarter revenues increased from €10.41 million to €27.44 million and net profit reached €0.147 million, up from a loss of €2.57 million last year. The company’s revenues and profits are expected to grow by 33.3% and 68.9% per year, respectively, significantly exceeding Dutch market forecasts.

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This Simply Wall St article is of a general nature. We comment based solely on historical data and analyst forecasts, using an unbiased methodology. Our articles are not intended as financial advice. They do not constitute a recommendation to buy or sell stocks and do not take into account your objectives or financial situation. Our goal is to provide you with long-term analysis based on fundamental data. Note that our analysis may not take into account the latest price-sensitive company announcements or qualitative materials. Simply Wall St does not hold any of the stocks mentioned.

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