Does Hapag-Lloyd’s Rising Share Price Signal Momentum or Risk in 2025?

If you are weighing your next move with Hapag-Lloyd, you are not alone. This stock has been on quite the ride, and the momentum is something investors keep talking about. Over just the past week, Hapag-Lloyd shares climbed 4.3%, showing that there is still plenty of interest in this transportation giant. But before you get too swept up, it is important to remember that over the past year, shares are down 12.3%, and year-to-date they have slipped 27.0%. So, should you see potential, or does this signal caution?

Despite this pullback, Hapag-Lloyd’s story is hardly all gloom. The long-term chart still looks impressive. In fact, zooming out to the last five years, the stock is up an eye-catching 280.2%. These gains are no accident. The shipping sector has seen waves of change, from capacity shifts to global supply chain rerouting. All of this has contributed to the recent volatility and price swings. News around shipping costs and container demand has only made the mood swingier, with risk perception among investors shifting from quarter to quarter.

Of course, price movements only tell part of the story. Valuation matters just as much. Looking at six different checks commonly used to assess whether a stock is undervalued, Hapag-Lloyd comes in with a valuation score of 2. This means it is considered undervalued by two out of the six valuation methods. But which methods matter most, and is there a smarter way to judge whether Hapag-Lloyd is truly a bargain? Next, let’s break down exactly how those valuation assessments stack up, and at the end, I will share a perspective that goes beyond the numbers to get you closer to the full picture.

Hapag-Lloyd scores just 2/6 on our valuation checks. See what other red flags we found in the full valuation breakdown.

Approach 1: Hapag-Lloyd Discounted Cash Flow (DCF) Analysis

The Discounted Cash Flow (DCF) model estimates a company's intrinsic value by projecting its future cash flows and discounting them back to their present value. This method helps investors understand what the business might truly be worth today, based on expected earnings spread out over many years.

For Hapag-Lloyd, the current Free Cash Flow over the last twelve months stands at approximately €2.96 billion. Analysts provide detailed forecasts for the next few years, with free cash flow expected to be €1.32 billion in 2026 and €1.41 billion in 2027. After that, Simply Wall St extrapolates estimates out to 2035, reflecting a gradual decline but steady cash generation, with projected annual free cash flow still above €900 million.

Based on these projections and the 2 Stage Free Cash Flow to Equity model, Hapag-Lloyd's estimated intrinsic value is €127.15 per share. This is about 6.9% higher than its current share price, implying that the stock is just slightly undervalued at today's levels.

Result: ABOUT RIGHT

Head to the Valuation section of our Company Report for more details on how we arrive at this Fair Value for Hapag-Lloyd.

Simply Wall St performs a valuation analysis on every stock in the world every day (check out Hapag-Lloyd's valuation analysis). We show the entire calculation in full. You can track the result in your watchlist or portfolio and be alerted when this changes.

Approach 2: Hapag-Lloyd Price vs Earnings (P/E)

The Price-to-Earnings (P/E) ratio is one of the most widely used valuation metrics, especially for profitable companies like Hapag-Lloyd. This measure reflects how much investors are willing to pay for each euro of earnings and is useful for understanding whether the stock’s price is justified by its profits. A company’s fair P/E depends not just on its current performance but also on expectations for future growth and the risks it faces. Fast-growing, lower-risk businesses usually command higher P/E ratios, while slower growers or riskier stocks often trade at a discount.

Currently, Hapag-Lloyd trades at a P/E of 8.81x. For context, the average P/E among its industry peers is 9.91x and the broader shipping industry sits at roughly 9.91x as well. At first glance, this makes the stock look slightly cheaper than its sector and peer group. However, while comparing with peers can be helpful, it often misses key factors unique to the company.

That is where Simply Wall St’s “Fair Ratio” comes in. This proprietary metric adjusts the standard P/E based on Hapag-Lloyd’s specific earnings growth potential, profit margins, size, risk profile, and its role in the shipping sector. As a result, it offers investors a more nuanced and personalized anchor for valuation than simple industry comparisons. Based on this analysis, Hapag-Lloyd’s fair P/E ratio is estimated at 8.31x. This is very close to the current multiple, suggesting the stock is trading at a price in line with its fundamentals.

Result: ABOUT RIGHT

PE ratios tell one story, but what if the real opportunity lies elsewhere? Discover companies where insiders are betting big on explosive growth.

Upgrade Your Decision Making: Choose your Hapag-Lloyd Narrative

Earlier we mentioned that there's an even better way to understand valuation, so let's introduce you to Narratives, a tool that helps you connect the story you believe about a company to a detailed financial forecast and an estimated fair value. A Narrative is simply your perspective, grounded in facts and expectations about Hapag-Lloyd’s future. You outline what you think will happen to its revenues, earnings, and profit margins, and then see what that means for its fair value today.

Narratives, available on Simply Wall St’s Community page, make it easy for anyone to model their outlook and compare it directly to the current price. This helps you decide if Hapag-Lloyd is a buy, hold, or sell, with no spreadsheets required. Because they update automatically with fresh news and financial results, your Narrative always reflects the latest information without any heavy lifting.

For Hapag-Lloyd, investors may arrive at quite different fair values. Some, expecting robust network expansion and margin recovery, see a fair value as high as €140.0 per share. Others, focusing on falling shipping demand and cost risks, place it as low as €72.0. By exploring and challenging these Narratives, you gain insight into both market sentiment and your own conviction, making every investment decision smarter and more personal.

Do you think there's more to the story for Hapag-Lloyd? Create your own Narrative to let the Community know!

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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