Last Update 11 Dec 25

Fair value Decreased 0.98%

NEXI: Future Upside Will Depend On Margin Expansion Execution

Analysts have slightly trimmed their price target on Nexi from EUR 5.90 to EUR 5.65. This reflects modestly weaker revenue growth and margin expectations that are only partly offset by a lower discount rate and a higher anticipated future P/E multiple.

Analyst Commentary

JPMorgan has reaffirmed a Neutral stance on Nexi, pairing the modest reduction in the price target with a balanced view on the company’s execution and growth prospects.

Bullish Takeaways

Bullish analysts highlight that the revised target of EUR 5.65 still implies upside from current trading levels, suggesting the market has already priced in much of the near term softness.
The higher anticipated future P/E multiple reflects confidence in Nexi’s ability to improve profitability as cost efficiencies and integration benefits progress over time.
Adjustments to a lower discount rate signal reduced perceived risk around Nexi’s long term cash flow generation and balance sheet resilience.
The maintained Neutral rating from a major broker such as JPMorgan indicates that, despite cuts, Nexi retains a credible path to delivering value if execution on strategic initiatives remains on track.

Bearish Takeaways

Bearish analysts point to the weaker revenue growth outlook as a key concern, raising questions around Nexi’s ability to sustain share gains in a competitive payments landscape.
The slightly lower margin expectations underscore ongoing pressure from integration costs and pricing competition, which could cap near term earnings momentum.
The need to trim the price target, even modestly, suggests that prior growth and profitability assumptions may have been too optimistic, tempering the overall equity story.
A Neutral rating, rather than a more constructive stance, reflects lingering uncertainty around the timing and consistency of Nexi’s execution on its transformation and synergy plans.

What's in the News

Nexi S.p.A. was dropped from the S&P EUROPE 350 index, signaling removal from a major regional benchmark tracked by institutional investors (Index Constituent Drops).
The company was also removed from the S&P EUROPE 350 Financials sector and the S&P EUROPE 350 Financial Services industry group, reducing its visibility within sector focused index products (Index Constituent Drops).
Nexi lost its place in the S&P International 700 and the S&P Global 1200 indices, further limiting its representation in global equity benchmarks (Index Constituent Drops).
Nexi confirmed its 2025 earnings guidance, targeting low to mid single digit net revenue growth year on year, with underlying growth expected to accelerate versus 2024 despite temporary headwinds from bank M&A and contract renegotiations (Corporate Guidance).
Nexi partnered with Giesecke+Devrient and Capgemini in a consortium selected by the European Central Bank as first ranked tenderer to develop and implement the offline payments solution for a potential digital euro, positioning Nexi at the core of future European payment infrastructure (Client Announcements).

Valuation Changes

The fair value estimate has fallen slightly from €5.72 to €5.66 per share, reflecting modestly softer assumptions in the model.
The discount rate has decreased marginally from 14.07 percent to 13.96 percent, indicating a small reduction in perceived risk to future cash flows.
Revenue growth has weakened slightly, with the long-term assumption moving from around minus 14.16 percent to minus 14.59 percent.
The net profit margin has been revised down modestly from 19.58 percent to 18.77 percent, pointing to a somewhat less optimistic profitability outlook.
The future P/E has risen slightly from 11.8x to 12.4x, suggesting a marginally higher expected valuation multiple on Nexi’s forward earnings.

Digital payments adoption, e-commerce growth, and strategic bank partnerships are strengthening Nexi's core revenue, customer base, and long-term market position.
Synergy-driven margin improvements, reduced integration costs, and innovative digital service offerings are driving higher profitability and new growth opportunities.
Loss of key contracts, regional concentration, price pressures, and integration risks threaten margin resilience, constrain growth, and expose Nexi to increased competition and revenue volatility.

Catalysts

About Nexi

Provides electronic money and payment services to banks, small and medium-sized enterprises, large international corporations, institutions, and public administrations in Italy, Nordics and Baltics, Germany, Austria, Switzerland, Poland, Southeast Europe, and internationally.What are the underlying business or industry changes driving this perspective?

Accelerating migration from cash to digital payments continues to fuel Nexi's core transaction volumes, especially in Italy and Central Europe, supporting robust long-term revenue growth and offsetting short-term headwinds from bank contract renegotiations.
E-commerce and mobile commerce penetration remains a key growth engine for Nexi, with customer base expansion of 5% across geographies and successful cross-selling of value-added digital services, driving higher take rates and supporting net margin expansion.
Ongoing integration of recent mergers and realization of associated cost synergies-including the reduction of transformation and integration expenses-are expanding EBITDA margins and generating stronger free cash flow, positioning Nexi for enhanced future earnings.
Investments in partnerships with ISVs (integrated software vendors), innovation in digital payment solutions, and support for emerging payment methods (such as instant payments and open banking alternatives) are creating new monetization opportunities, broadening the addressable market and supporting long-term revenue and earnings growth.
Renewed and extended multi-year contracts with major banking partners, particularly in Italy, add resilience and visibility to Nexi's revenue streams, reducing downside risk and enabling continued investment in growth initiatives and shareholder returns.

Nexi Future Earnings and Revenue Growth

Assumptions

How have these above catalysts been quantified?

Analysts are assuming Nexi's revenue will decrease by 13.7% annually over the next 3 years.
Analysts assume that profit margins will increase from 4.8% today to 20.1% in 3 years time.
Analysts expect earnings to reach €813.9 million (and earnings per share of €0.66) by about September 2028, up from €304.8 million today. However, there is a considerable amount of disagreement amongst the analysts with the most bullish expecting €962 million in earnings, and the most bearish expecting €529.2 million.
In order for the above numbers to justify the analysts price target, the company would need to trade at a PE ratio of 13.6x on those 2028 earnings, down from 20.5x today. This future PE is greater than the current PE for the IT Diversified Financial industry at 11.0x.
Analysts expect the number of shares outstanding to decline by 2.86% per year for the next 3 years.
To value all of this in today's terms, we will use a discount rate of 13.75%, as per the Simply Wall St company report.

Nexi Future Earnings Per Share Growth

Risks

What could happen that would invalidate this narrative?

Recent loss of key bank distribution contracts in Italy and associated migration of transaction volumes away from Nexi present a structural challenge, potentially leading to ongoing revenue headwinds and increasing volatility, particularly as these impacts are expected to persist and possibly accelerate in the coming quarters.
Contract renewals with bank partners often require price concessions or discounts, and although volume growth can offset initial revenue loss, the cumulative effect of repeated renegotiations or lost contracts could compress net margins and constrain long-term earnings growth.
While the company points to robust relationships with Italian banks, there is ongoing geographic concentration risk in Southern Europe; sustained macroeconomic volatility, economic stagnation, or intensified regional competition could weaken revenue resilience and growth prospects over time.
Despite the company's strategy of cross-selling value-added services and innovation, the slow development and market adoption of integrated software payment (ISV) channels in key markets like Italy may undermine differentiation efforts, leaving Nexi more exposed to margin compression from both regulatory change (fee caps) and competitive threats (global tech entrants, local disruptors).
Heavy reliance on M&A-driven growth and integration synergies presents operational and execution risk; persistent integration costs, delayed synergy realization, and ongoing leverage from recent acquisitions could limit Nexi's capacity for organic investment and innovation, thereby restricting improvements in net earnings and shareholder value creation in the longer term.

Valuation

How have all the factors above been brought together to estimate a fair value?

The analysts have a consensus price target of €6.9 for Nexi based on their expectations of its future earnings growth, profit margins and other risk factors. However, there is a degree of disagreement amongst analysts, with the most bullish reporting a price target of €8.75, and the most bearish reporting a price target of just €4.5.
In order for you to agree with the analyst's consensus, you'd need to believe that by 2028, revenues will be €4.1 billion, earnings will come to €813.9 million, and it would be trading on a PE ratio of 13.6x, assuming you use a discount rate of 13.7%.
Given the current share price of €5.24, the analyst price target of €6.9 is 24.1% higher.
We always encourage you to reach your own conclusions though. So sense check these analyst numbers against your own assumptions and expectations based on your understanding of the business and what you believe is probable.

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Disclaimer

AnalystConsensusTarget is a tool utilizing a Large Language Model (LLM) that ingests data on consensus price targets, forecasted revenue and earnings figures, as well as the transcripts of earnings calls to produce qualitative analysis. The narratives produced by AnalystConsensusTarget are general in nature and are based solely on analyst data and publicly-available material published by the respective companies. These scenarios are not indicative of the company's future performance and are exploratory in nature. Simply Wall St has no position in the company(s) mentioned. Simply Wall St may provide the securities issuer or related entities with website advertising services for a fee, on an arm's length basis. These relationships have no impact on the way we conduct our business, the content we host, or how our content is served to users. The price targets and estimates used are consensus data, and do not constitute a recommendation to buy or sell any stock, and they do not take account of your objectives, or your financial situation. Note that AnalystConsensusTarget's analysis may not factor in the latest price-sensitive company announcements or qualitative material.

Digital Payments Momentum Will Drive Broader Transformation Across Europe