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Yahoo
9 hours ago
- Business
- Yahoo
Northern Data AG (FRA:NB2) Shares Could Be 33% Above Their Intrinsic Value Estimate
Northern Data's estimated fair value is €19.16 based on 2 Stage Free Cash Flow to Equity Northern Data's €25.52 share price signals that it might be 33% overvalued Our fair value estimate is 56% lower than Northern Data's analyst price target of €43.20 Today we will run through one way of estimating the intrinsic value of Northern Data AG (FRA:NB2) by taking the forecast future cash flows of the company and discounting them back to today's value. One way to achieve this is by employing the Discounted Cash Flow (DCF) model. Models like these may appear beyond the comprehension of a lay person, but they're fairly easy to follow. We would caution that there are many ways of valuing a company and, like the DCF, each technique has advantages and disadvantages in certain scenarios. Anyone interested in learning a bit more about intrinsic value should have a read of the Simply Wall St analysis model. This technology could replace computers: discover the 20 stocks are working to make quantum computing a reality. We are going to use a two-stage DCF model, which, as the name states, takes into account two stages of growth. The first stage is generally a higher growth period which levels off heading towards the terminal value, captured in the second 'steady growth' period. In the first stage we need to estimate the cash flows to the business over the next ten years. Where possible we use analyst estimates, but when these aren't available we extrapolate the previous free cash flow (FCF) from the last estimate or reported value. We assume companies with shrinking free cash flow will slow their rate of shrinkage, and that companies with growing free cash flow will see their growth rate slow, over this period. We do this to reflect that growth tends to slow more in the early years than it does in later years. Generally we assume that a dollar today is more valuable than a dollar in the future, so we discount the value of these future cash flows to their estimated value in today's dollars: 2025 2026 2027 2028 2029 2030 2031 2032 2033 2034 Levered FCF (€, Millions) €112.3m €173.4m €123.4m €97.1m €82.9m €74.8m €69.9m €67.0m €65.3m €64.4m Growth Rate Estimate Source Analyst x3 Analyst x3 Analyst x1 Est @ -21.34% Est @ -14.56% Est @ -9.81% Est @ -6.49% Est @ -4.16% Est @ -2.53% Est @ -1.39% Present Value (€, Millions) Discounted @ 7.2% €105 €151 €100 €73.4 €58.5 €49.2 €42.9 €38.4 €34.9 €32.1 ("Est" = FCF growth rate estimated by Simply Wall St)Present Value of 10-year Cash Flow (PVCF) = €685m We now need to calculate the Terminal Value, which accounts for all the future cash flows after this ten year period. For a number of reasons a very conservative growth rate is used that cannot exceed that of a country's GDP growth. In this case we have used the 5-year average of the 10-year government bond yield (1.3%) to estimate future growth. In the same way as with the 10-year 'growth' period, we discount future cash flows to today's value, using a cost of equity of 7.2%. Terminal Value (TV)= FCF2034 × (1 + g) ÷ (r – g) = €64m× (1 + 1.3%) ÷ (7.2%– 1.3%) = €1.1b Present Value of Terminal Value (PVTV)= TV / (1 + r)10= €1.1b÷ ( 1 + 7.2%)10= €545m The total value is the sum of cash flows for the next ten years plus the discounted terminal value, which results in the Total Equity Value, which in this case is €1.2b. In the final step we divide the equity value by the number of shares outstanding. Relative to the current share price of €25.5, the company appears reasonably expensive at the time of writing. Valuations are imprecise instruments though, rather like a telescope - move a few degrees and end up in a different galaxy. Do keep this in mind. The calculation above is very dependent on two assumptions. The first is the discount rate and the other is the cash flows. Part of investing is coming up with your own evaluation of a company's future performance, so try the calculation yourself and check your own assumptions. The DCF also does not consider the possible cyclicality of an industry, or a company's future capital requirements, so it does not give a full picture of a company's potential performance. Given that we are looking at Northern Data as potential shareholders, the cost of equity is used as the discount rate, rather than the cost of capital (or weighted average cost of capital, WACC) which accounts for debt. In this calculation we've used 7.2%, which is based on a levered beta of 1.376. Beta is a measure of a stock's volatility, compared to the market as a whole. We get our beta from the industry average beta of globally comparable companies, with an imposed limit between 0.8 and 2.0, which is a reasonable range for a stable business. View our latest analysis for Northern Data Strength Debt is well covered by earnings. Weakness Expensive based on P/S ratio and estimated fair value. Shareholders have been diluted in the past year. Opportunity NB2's financial characteristics indicate limited near-term opportunities for shareholders. Threat Debt is not well covered by operating cash flow. Has less than 3 years of cash runway based on current free cash flow. Valuation is only one side of the coin in terms of building your investment thesis, and it shouldn't be the only metric you look at when researching a company. The DCF model is not a perfect stock valuation tool. Rather it should be seen as a guide to "what assumptions need to be true for this stock to be under/overvalued?" For example, changes in the company's cost of equity or the risk free rate can significantly impact the valuation. Why is the intrinsic value lower than the current share price? For Northern Data, there are three fundamental factors you should look at: Risks: For example, we've discovered 3 warning signs for Northern Data (1 is potentially serious!) that you should be aware of before investing here. Future Earnings: How does NB2's growth rate compare to its peers and the wider market? Dig deeper into the analyst consensus number for the upcoming years by interacting with our free analyst growth expectation chart. Other High Quality Alternatives: Do you like a good all-rounder? Explore our interactive list of high quality stocks to get an idea of what else is out there you may be missing! PS. Simply Wall St updates its DCF calculation for every German stock every day, so if you want to find the intrinsic value of any other stock just search here. Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) 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.
Yahoo
13-05-2025
- Business
- Yahoo
European Stock Selections That May Be Underrated In May 2025
As the European markets experience mixed movements, with the STOXX Europe 600 Index rising for a fourth consecutive week amid easing trade tensions, investors are closely watching economic indicators and central bank decisions. In this environment, identifying potentially undervalued stocks can be crucial, as these opportunities might offer value amidst fluctuating market conditions. Name Current Price Fair Value (Est) Discount (Est) Maire (BIT:MAIRE) €9.875 €19.55 49.5% ILPRA (BIT:ILP) €4.50 €8.81 48.9% Sword Group (ENXTPA:SWP) €31.40 €62.63 49.9% Benefit Systems (WSE:BFT) PLN3500.00 PLN6989.78 49.9% Alfio Bardolla Training Group (BIT:ABTG) €1.91 €3.72 48.7% Lectra (ENXTPA:LSS) €24.75 €48.12 48.6% dormakaba Holding (SWX:DOKA) CHF711.00 CHF1399.70 49.2% MilDef Group (OM:MILDEF) SEK229.20 SEK445.21 48.5% Martela Oyj (HLSE:MARAS) €0.778 €1.50 48.2% Northern Data (DB:NB2) €24.96 €49.78 49.9% Click here to see the full list of 175 stocks from our Undervalued European Stocks Based On Cash Flows screener. Let's dive into some prime choices out of the screener. Overview: Northern Data AG develops and operates high-performance computing (HPC) and artificial intelligence (AI) solutions for businesses and research institutions worldwide, with a market cap of €1.60 billion. Operations: The company's revenue segments include Peak Mining (€187.51 million), Taiga Cloud (€231.88 million), and Ardent Data Centers (€21.55 million). Estimated Discount To Fair Value: 49.9% Northern Data appears significantly undervalued, trading at 49.9% below its estimated fair value of €49.78 per share, with a current price of €24.96. Despite recent volatility and past shareholder dilution, the company is poised for strong revenue growth at 20.4% annually, outpacing the German market average. Recent partnerships and strategic divestments aim to enhance its AI infrastructure capabilities, potentially improving cash flow stability as it transitions towards profitability over the next three years. According our earnings growth report, there's an indication that Northern Data might be ready to expand. Click here to discover the nuances of Northern Data with our detailed financial health report. Overview: Lisi S.A. offers assembly and component solutions for the aerospace, automotive, and medical sectors globally, with a market cap of €1.33 billion. Operations: The company's revenue is segmented into LISI Aerospace at €10.30 billion, LISI Automotive at €579.70 million, and LISI Medical at €185.30 million. Estimated Discount To Fair Value: 19.4% Lisi is trading at €29.20, below its estimated fair value of €36.23, suggesting potential undervaluation based on cash flows. Earnings are forecast to grow significantly at 22.5% annually, outpacing the French market's average growth rate. However, interest payments are not well covered by earnings and large one-off items have impacted financial results recently. Despite these concerns, Lisi announced a dividend increase to €0.39 per share with an ex-date of April 30, 2025. Our growth report here indicates Lisi may be poised for an improving outlook. Get an in-depth perspective on Lisi's balance sheet by reading our health report here. Overview: SmartCraft ASA offers software solutions tailored for the construction industry across Norway, Sweden, Finland, and the United Kingdom, with a market capitalization of NOK4.60 billion. Operations: SmartCraft ASA generates revenue through its software solutions designed for the construction sector in Norway, Sweden, Finland, and the United Kingdom. Estimated Discount To Fair Value: 25.1% SmartCraft, trading at NOK 27.6, is undervalued relative to its estimated fair value of NOK 36.85, based on cash flows. Despite a decline in profit margins from last year, the company shows strong potential with earnings expected to grow significantly at 28.2% annually, surpassing the Norwegian market's average growth rate. Recent product innovations like Congrid's BIM feature enhance operational efficiency and could support future revenue growth despite slower-than-ideal revenue projections. The analysis detailed in our SmartCraft growth report hints at robust future financial performance. Dive into the specifics of SmartCraft here with our thorough financial health report. Dive into all 175 of the Undervalued European Stocks Based On Cash Flows we have identified here. Shareholder in one or more of these companies? Ensure you're never caught off-guard by adding your portfolio in Simply Wall St for timely alerts on significant stock developments. Take control of your financial future using Simply Wall St, offering free, in-depth knowledge of international markets to every investor. Explore high-performing small cap companies that haven't yet garnered significant analyst attention. Diversify your portfolio with solid dividend payers offering reliable income streams to weather potential market turbulence. Fuel your portfolio with companies showing strong growth potential, backed by optimistic outlooks both from analysts and management. 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 DB:NB2 ENXTPA:FII and OB:SMCRT. This article was originally published by Simply Wall St. Have feedback on this article? Concerned about the content? with us directly. Alternatively, email editorial-team@ Sign in to access your portfolio
Yahoo
23-04-2025
- Business
- Yahoo
High Growth Tech Stocks To Watch In Europe April 2025
In recent weeks, the European market has shown signs of recovery with the pan-European STOXX Europe 600 Index climbing 3.93%, buoyed by the European Central Bank's decision to cut rates amid trade uncertainties and President Trump's delay in imposing higher tariffs. As investors navigate this evolving landscape, identifying high-growth tech stocks requires a focus on companies that demonstrate resilience and innovation in response to shifting economic conditions and policy changes. Name Revenue Growth Earnings Growth Growth Rating Pharma Mar 23.66% 40.07% ★★★★★★ Yubico 20.08% 25.52% ★★★★★★ Elicera Therapeutics 63.53% 97.24% ★★★★★★ Devyser Diagnostics 26.28% 96.54% ★★★★★★ Ascelia Pharma 46.06% 66.78% ★★★★★★ CD Projekt 33.78% 37.39% ★★★★★★ XTPL 97.45% 117.95% ★★★★★★ Skolon 29.76% 91.18% ★★★★★★ Elliptic Laboratories 49.76% 88.21% ★★★★★★ Xbrane Biopharma 33.71% 82.67% ★★★★★★ Click here to see the full list of 231 stocks from our European High Growth Tech and AI Stocks screener. Here's a peek at a few of the choices from the screener. Simply Wall St Growth Rating: ★★★★★☆ Overview: Northern Data AG specializes in providing high-performance computing and artificial intelligence solutions to businesses and research institutions globally, with a market capitalization of approximately €1.61 billion. Operations: The company generates revenue primarily from its Taiga Cloud and Peak Mining segments, contributing €231.88 million and €187.51 million respectively. Ardent Data Centers adds another €21.55 million to the revenue stream. Northern Data's recent partnership with Gcore marks a strategic advance in AI services, positioning it to capitalize on the burgeoning AI inferencing market, projected to reach USD 169 billion by 2032. This collaboration leverages Northern Data's robust GPU infrastructure and Gcore's innovative software, creating a comprehensive AI delivery network designed for low-latency at the edge—crucial for expanding AI application adoption. Financially, Northern Data anticipates revenues between EUR 520 million and EUR 570 million for FY2025, reflecting its focus on enhancing its AI cloud platform post-divestment of Peak Mining. Despite a challenging past with significant losses (EUR 127.44 million in FY2024), the company's strategic pivot towards high-growth tech sectors like AI could reshape its financial landscape, supported by an expected annual revenue growth rate of 20.3% and an earnings growth forecast of 116.6%. Navigate through the intricacies of Northern Data with our comprehensive health report here. Review our historical performance report to gain insights into Northern Data's's past performance. Simply Wall St Growth Rating: ★★★★★☆ Overview: OVH Groupe S.A. is a global provider of public and private cloud services, shared hosting, and dedicated server solutions with a market capitalization of approximately €2 billion. Operations: The company's revenue streams are primarily driven by its Private Cloud services, generating €655.28 million, followed by Public Cloud at €198.23 million and Web Cloud & Other at €189.46 million. OVH Groupe's recent earnings announcement showcased a significant turnaround, with sales rising to €536 million from €486.09 million year-over-year and net income reaching €7.21 million, reversing a previous loss of €17.24 million. This performance underscores OVH's recovery trajectory, augmented by strategic partnerships like the one with HYCU Inc., enhancing its cloud services portfolio for diverse virtual environments. The company's R&D commitment is evident in its expanded server range and tailored cloud solutions across multiple data centers, positioning it well within Europe's tech landscape despite a volatile share price and earnings coverage concerns. With an anticipated annual profit growth of 81.4% and revenue growth outpacing the French market at 9.9%, OVH is aligning itself with broader industry trends towards specialized cloud services and infrastructure resilience. Take a closer look at OVH Groupe's potential here in our health report. Gain insights into OVH Groupe's past trends and performance with our Past report. Simply Wall St Growth Rating: ★★★★★☆ Overview: VusionGroup S.A. offers digitalization solutions for commerce across Europe, Asia, and North America with a market cap of €3.26 billion. Operations: VusionGroup S.A. generates revenue primarily from installing and maintaining electronic shelf labels, amounting to €954.70 million. VusionGroup S.A. is setting a brisk pace in Europe's tech sector with its projected annual revenue growth at 19.4%, significantly outstripping the French market's 5.4%. This growth trajectory is complemented by an aggressive R&D stance, as evidenced in their latest earnings call, although specific figures were not disclosed. The company has also doubled its dividend to EUR 0.60, signaling confidence in future cash flows and profitability which is expected to materialize within three years with an anticipated profit surge of 68.85% annually. Despite current unprofitability and a highly volatile share price, these moves could position VusionGroup as a more influential player in the tech landscape, especially if it can stabilize earnings and continue to innovate effectively. Click here to discover the nuances of VusionGroup with our detailed analytical health report. Examine VusionGroup's past performance report to understand how it has performed in the past. Embark on your investment journey to our 231 European High Growth Tech and AI Stocks selection here. Are these companies part of your investment strategy? Use Simply Wall St to consolidate your holdings into a portfolio and gain insights with our comprehensive analysis tools. Simply Wall St is a revolutionary app designed for long-term stock investors, it's free and covers every market in the world. Explore high-performing small cap companies that haven't yet garnered significant analyst attention. Fuel your portfolio with companies showing strong growth potential, backed by optimistic outlooks both from analysts and management. Find companies with promising cash flow potential yet trading below their fair value. 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 DB:NB2 ENXTPA:OVH and ENXTPA:VU. Have feedback on this article? Concerned about the content? with us directly. Alternatively, email editorial-team@ Sign in to access your portfolio
Yahoo
25-03-2025
- Business
- Yahoo
High Growth Tech Stocks in Europe Featuring Northern Data and Two Others
Amidst a backdrop of mixed performances across European indices, the pan-European STOXX Europe 600 Index has managed to end higher, buoyed by optimism around potential government spending increases despite ongoing concerns about U.S. tariffs. In this environment of economic uncertainty and cautious central bank policies, identifying high-growth tech stocks in Europe requires focusing on companies that demonstrate robust innovation and adaptability to navigate these challenges effectively. Name Revenue Growth Earnings Growth Growth Rating Elicera Therapeutics 63.53% 97.24% ★★★★★★ Pharma Mar 24.24% 40.82% ★★★★★★ Yubico 20.88% 26.53% ★★★★★★ Bonesupport Holding 30.48% 50.17% ★★★★★★ CD Projekt 30.55% 39.06% ★★★★★★ XTPL 97.45% 117.95% ★★★★★★ Devyser Diagnostics 26.50% 94.65% ★★★★★★ Skolon 29.71% 91.18% ★★★★★★ Ascelia Pharma 46.09% 66.93% ★★★★★★ Elliptic Laboratories 49.76% 88.21% ★★★★★★ Click here to see the full list of 243 stocks from our European High Growth Tech and AI Stocks screener. Let's review some notable picks from our screened stocks. Simply Wall St Growth Rating: ★★★★★☆ Overview: Northern Data AG focuses on developing and operating high-performance computing infrastructure solutions for businesses and research institutions globally, with a market capitalization of €1.61 billion. Operations: The company generates revenue primarily through its Peak Mining and Ardent Data Centers segments, contributing €156.13 million and €31.46 million, respectively. The Taiga Cloud segment adds €22.13 million to the revenue stream. Northern Data's trajectory in the high-growth tech sector is marked by a robust forecasted revenue increase of 23.8% annually, significantly outpacing the German market's 6%. Despite current unprofitability, earnings are expected to surge by an impressive 91.3% per year, positioning the company for potential profitability within three years. Recent executive shifts, including the appointment of John Hoffman as COO, underscore a strategic push to capitalize on its AI and High-Performance Computing solutions. This leadership renewal could be pivotal in steering Northern Data towards harnessing its full growth potential amidst market challenges. Click to explore a detailed breakdown of our findings in Northern Data's health report. Assess Northern Data's past performance with our detailed historical performance reports. Simply Wall St Growth Rating: ★★★★★☆ Overview: Comet Holding AG, along with its subsidiaries, delivers X-ray and radio frequency (RF) power technology solutions across Europe, North America, Asia, and other international markets with a market capitalization of CHF1.83 billion. Operations: The company's revenue streams are primarily derived from Plasma Control Technologies (CHF247.39 million), X-Ray Systems (CHF115.89 million), and Industrial X-Ray Modules (CHF94.57 million). Comet Holding's recent performance underscores its robust position in the high-tech European market, with a notable 128.2% surge in earnings last year and a dividend increase to CHF 1.50 per share, reflecting strong financial health and shareholder confidence. The company's revenue growth at 13.2% annually outpaces the Swiss market average of 4.5%, supported by significant R&D investments aimed at pioneering advancements in tech sectors crucial for future growth. With earnings expected to grow by an impressive 38.4% annually over the next three years, Comet Holding is well-positioned to leverage its technological innovations and market adaptability despite a highly volatile share price recently, highlighting both potential rewards and risks inherent in its sector. Click here to discover the nuances of Comet Holding with our detailed analytical health report. Learn about Comet Holding's historical performance. Simply Wall St Growth Rating: ★★★★★☆ Overview: LEM Holding SA, along with its subsidiaries, specializes in providing solutions for measuring electrical parameters across various global regions including China, Japan, South Korea, India, Southeast Asia, Europe, the Middle East, Africa, NAFTA and Latin America with a market capitalization of CHF854.36 million. Operations: The company generates revenue by offering electrical measurement solutions across diverse regions, with a significant presence in Asia, Europe, and the Americas. It focuses on leveraging its expertise in measuring electrical parameters to cater to various industries globally. LEM Holding's trajectory in the high-tech European sector is marked by a robust 13.3% annual revenue growth, outpacing the Swiss market average of 4.5%. Despite a challenging year with earnings declining by 70.9%, the company's commitment to innovation is evident from its R&D investments, which are crucial for future competitiveness in electronics and automation industries. With new executive leadership poised to steer future strategies starting May 2025, LEM aims to leverage its technical prowess and deep industry connections to navigate through market volatilities and enhance shareholder value. Get an in-depth perspective on LEM Holding's performance by reading our health report here. Review our historical performance report to gain insights into LEM Holding's's past performance. Click this link to deep-dive into the 243 companies within our European High Growth Tech and AI Stocks screener. Are you invested in these stocks already? Keep abreast of every twist and turn by setting up a portfolio with Simply Wall St, where we make it simple for investors like you to stay informed and proactive. Simply Wall St is a revolutionary app designed for long-term stock investors, it's free and covers every market in the world. Explore high-performing small cap companies that haven't yet garnered significant analyst attention. Fuel your portfolio with companies showing strong growth potential, backed by optimistic outlooks both from analysts and management. Find companies with promising cash flow potential yet trading below their fair value. 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 DB:NB2 SWX:COTN and SWX:LEHN. Have feedback on this article? Concerned about the content? with us directly. Alternatively, email editorial-team@ Sign in to access your portfolio
