Alstom (ENXTPA:ALO) Valuation Spotlight as CEO Transition Signals Strategic Shift

Alstom (ENXTPA:ALO) announced that Martin Sion will take over as Chief Executive Officer in April 2026, following a months-long search after Henri Poupart-Lafarge chose not to renew his term. Investors often pay close attention to these transitions, since a new CEO can reshape company priorities and direction.

See our latest analysis for Alstom.

Alstom’s momentum has picked up in recent months, with a 5.9% one-month and 11.4% three-month share price return. This has been partly fueled by major orders in Europe and the new CEO announcement. Despite a bumpy five-year ride, the company’s 13.6% total return over the past year suggests optimism is building as investors anticipate growth and operational improvements ahead.

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So, with shares up double digits over the past year and expectations building around new leadership, is Alstom trading at a discount or are investors already baking in the next chapter of growth?

Most Popular Narrative: 3% Undervalued

With Alstom closing at €22.30 and the widely followed narrative citing fair value at €23.06, the market sees a small upside. This context adds weight to the next major catalyst that shapes the current thinking on Alstom’s potential trajectory.

The company is conducting industrial restructuring to optimize its manufacturing setup, aiming to enhance operational efficiency and potentially improve net margins and earnings. Significant future opportunities lie in Alstom's strong order pipeline, especially in Europe, the Middle East, and Asia Pacific. With €200 billion expected in orders over the next three years, this could enhance revenue.

Read the complete narrative.

Curious about what’s driving this price target? The market’s attention is focused on new projects and bold margin upgrades. However, the real surprise is in the aggressive future profit forecasts and what they signal about Alstom’s turnaround potential. Want the full breakdown of the narrative’s assumptions and which quantitative factors are doing the heavy lifting? You’ll need to see the complete analysis to unlock those details.

Result: Fair Value of €23.06 (UNDERVALUED)

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

However, persistent supply chain disruptions or the drag from low-margin legacy contracts could quickly challenge bullish expectations and change Alstom’s outlook.

Find out about the key risks to this Alstom narrative.

Another View: What Do Multiples Say?

While the narrative approach suggests a small upside, looking at Alstom’s valuation through a price-to-earnings lens tells a different story. The company trades at 72.6 times earnings, which is much pricier than both peer (16.9x) and industry averages (20.4x), as well as the fair ratio of 39.8x. This wide gap hints at potential overvaluation. Will the market eventually demand a lower multiple, or does Alstom’s pipeline justify paying up?

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

Build Your Own Alstom Narrative

If you want to go beyond consensus and follow your own research path, you can craft an Alstom narrative yourself in just a few minutes. Do it your way

A great starting point for your Alstom research is our analysis highlighting 2 key rewards and 1 important warning sign that could impact your investment decision.

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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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