secunet Security Networks (XTRA:YSN) Valuation After NATO HERMES Project Win with CGI

secunet Security Networks (XTRA:YSN) is back on investors radar after NATO tapped its Secure Inter Network Architecture for the HERMES mobile command project, a collaboration led alongside IT services provider CGI.

See our latest analysis for secunet Security Networks.

The NATO HERMES contract arrives as momentum in the shares has picked back up, with a 10.27% 1 month share price return helping lift the stock to €186.8 and contributing to a 58.84% year to date share price gain. The 1 year total shareholder return of 60.30% underlines how sentiment has steadily improved, despite more modest 3 year total shareholder returns of 1.11% and a still negative 5 year total shareholder return of 16.31%.

If this kind of security focused contract win has your attention, it might be a good moment to see what else is moving across fast growing stocks with high insider ownership.

With shares already up strongly this year and trading at a modest discount to analyst targets despite mid single digit revenue growth, the key question now is whether secunet still offers upside or if markets are already pricing in future gains.

Most Popular Narrative Narrative: 14% Undervalued

With secunet closing at €186.8 against a narrative fair value of €216.75, the current setup frames an upbeat long term earnings and margin story.

Ongoing digital transformation initiatives across European governments, NATO institutions, and regulated sectors, coupled with the proliferation of connected devices and migration to cloud architectures, are expanding the need for secure integrated cloud native solutions that secure multi year, high value contracts and recurring revenues for secunet.

Read the complete narrative.

Curious how recurring contracts, rising margins, and a punchy future earnings multiple all fit together? Want to see the exact roadmap behind that valuation?

Result: Fair Value of $216.75 (UNDERVALUED)

Have a read of the narrative in full and understand what's behind the forecasts.

However, heavy reliance on German public sector budgets and rising competition from larger global cybersecurity players could quickly undermine those upbeat long term expectations.

Find out about the key risks to this secunet Security Networks narrative.

Another View, Rich Multiples Signal Caution

While the narrative fair value points to upside, the price tag tells a different story. secunet trades on a P E of 37.8 times versus 25.5 times for peers and 18.9 times for the wider European IT sector, and above its own fair ratio of 25.1 times. This suggests meaningful valuation risk if sentiment cools. Is the market overpaying for safety and growth visibility?

See what the numbers say about this price — find out in our valuation breakdown.

Build Your Own secunet Security Networks Narrative

If you see the story differently or want to dig into the numbers yourself, you can build a personalised narrative in just a few minutes: Do it your way.

A good starting point is our analysis highlighting 2 key rewards investors are optimistic about regarding secunet Security Networks.

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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.

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