Loomis (OM:LOOMIS): Evaluating Valuation Following Q3 Growth and Major Share Buyback

Loomis (OM:LOOMIS) just reported its third quarter results, revealing gains in both sales and net income compared to last year. At the same time, the company wrapped up a substantial share buyback program.

See our latest analysis for Loomis.

Loomis’s latest buyback and strong quarterly results come after a year of steady momentum. The company’s share price has climbed 7.1% year to date, while its 1-year total shareholder return of 15% highlights solid rewards for investors factoring in both price appreciation and dividends. Long-term holders have also seen nearly 40% and 89% total returns over the past 3 and 5 years respectively. While recent months have seen a pullback, these operational highlights could set the stage for renewed confidence ahead.

If Loomis’s management moves and shareholder rewards have piqued your interest, now’s the perfect moment to broaden your perspective and discover fast growing stocks with high insider ownership

With shares already gaining this year and new results in hand, the key question is whether Loomis remains undervalued after its run or if the market has already priced in the company’s next leg of growth.

Most Popular Narrative: 19.8% Undervalued

According to the narrative, Loomis trades well below its estimated fair value, closing recently at SEK 363.20 versus a calculated fair value near SEK 452.67. This creates a story of a stock potentially poised for upside, supported by significant changes in the business model and growth strategy.

Ongoing technological investments in automation (smart safes, digital monitoring, cash recyclers) and Loomis Pay are enabling upselling, margin expansion and diversified revenue streams. This positions the company to capture a greater share of integrated security and cash management spending, impacting both revenue and earnings.

Read the complete narrative.

Curious what drives such a substantial valuation gap? There is a bold set of financial projections behind this fair value, shaped by accelerating earnings, rising margins, and significant business shifts. Uncover which surprising catalysts and forward-looking assumptions are fueling the current consensus target by reading the full narrative.

Result: Fair Value of SEK 452.67 (UNDERVALUED)

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

However, persistent declines in cash usage and slower than expected growth from Loomis's digital solutions could challenge the company's ability to sustain current margin improvements.

Find out about the key risks to this Loomis narrative.

Build Your Own Loomis Narrative

Feel like the story could unfold differently, or ready to dive into the details on your own? You can shape your perspective and create a unique take in just minutes. Do it your way

A great starting point for your Loomis research is our analysis highlighting 4 key rewards and 1 important warning sign that could impact your investment decision.

Looking for More Winning Opportunities?

Smart investors always keep an eye on where the next big move could come from. Don’t let the market’s best ideas pass you by. Target your search and claim your edge right now using these handpicked strategies.

• Capitalize on high-potential tech trends by tracking these 26 AI penny stocks that are using artificial intelligence to disrupt traditional industries and reshape what’s possible.
• Secure income and long-term stability by evaluating these 15 dividend stocks with yields > 3% offering strong yields above 3% to power up your portfolio with consistent cash flow.
• Harness the explosive growth of digital finance with these 82 cryptocurrency and blockchain stocks tapping into surging cryptocurrency and blockchain adoption before mainstream momentum hits.

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.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team@simplywallst.com