3 Swedish Stocks That May Be Trading Below Fair Value

As global markets navigate a period of mixed economic signals and fluctuating indices, the Swedish stock market presents unique opportunities for discerning investors. In this environment, identifying stocks that may be trading below their fair value can offer significant potential for long-term gains. A good stock in today's market is one that demonstrates strong fundamentals and resilience amidst economic uncertainties. Here, we explore three Swedish stocks that may be undervalued, offering promising prospects for those looking to capitalize on potential growth in the Scandinavian market.

Top 10 Undervalued Stocks Based On Cash Flows In Sweden

Name	Current Price	Fair Value (Est)	Discount (Est)
Gränges (OM:GRNG)	SEK130.70	SEK260.53	49.8%
Husqvarna (OM:HUSQ B)	SEK72.36	SEK142.83	49.3%
Nordic Waterproofing Holding (OM:NWG)	SEK160.40	SEK310.63	48.4%
Volati (OM:VOLO)	SEK119.60	SEK233.13	48.7%
Svedbergs Group (OM:SVED BTA B)	SEK36.30	SEK65.51	44.6%
Nordisk Bergteknik (OM:NORB B)	SEK16.96	SEK31.01	45.3%
PowerCell Sweden (OM:PCELL)	SEK25.58	SEK46.31	44.8%
Sinch (OM:SINCH)	SEK28.96	SEK56.72	48.9%
MilDef Group (OM:MILDEF)	SEK74.00	SEK143.20	48.3%
Bactiguard Holding (OM:BACTI B)	SEK70.60	SEK133.47	47.1%

Click here to see the full list of 50 stocks from our Undervalued Swedish Stocks Based On Cash Flows screener.

Let's take a closer look at a couple of our picks from the screened companies.

Fortnox (OM:FNOX)

Overview: Fortnox AB (publ) offers financial and administrative software solutions for small and medium-sized businesses, accounting firms, and organizations, with a market cap of SEK40.28 billion.

Operations: Fortnox AB (publ) generates revenue from several segments, including Businesses (SEK378 million), Marketplaces (SEK160 million), Core Products (SEK734 million), Accounting Firms (SEK352 million), and Financial Services (SEK249 million).

Estimated Discount To Fair Value: 13.4%

Fortnox is trading at SEK66.04, below its estimated fair value of SEK76.26, indicating it may be undervalued based on cash flows. Earnings are forecast to grow 22.63% annually over the next three years, outpacing the Swedish market's 15.5%. Recent earnings reports show strong performance with Q2 sales at SEK515 million and net income at SEK164 million, reflecting solid financial health and growth potential despite a modest discount to fair value.

• Insights from our recent growth report point to a promising forecast for Fortnox's business outlook.
• Click here and access our complete balance sheet health report to understand the dynamics of Fortnox.

Humble Group (OM:HUMBLE)

Overview: Humble Group AB (publ) refines, develops, and distributes fast-moving consumer products in Sweden and internationally, with a market cap of SEK4.29 billion.

Operations: The company's revenue segments include Future Snacking (SEK950 million), Sustainable Care (SEK2.30 billion), Quality Nutrition (SEK1.53 billion), and Nordic Distribution (SEK2.67 billion).

Estimated Discount To Fair Value: 42.1%

Humble Group, trading at SEK 9.6, is significantly undervalued against an estimated fair value of SEK 16.57. Recent earnings reports highlight strong revenue growth with Q2 sales reaching SEK 1,863 million and net income at SEK 32 million. Despite a low forecasted return on equity of 8.7%, the company's expected annual profit and revenue growth rates are well above market averages, indicating robust potential for future profitability and cash flow generation.

• According our earnings growth report, there's an indication that Humble Group might be ready to expand.
• Dive into the specifics of Humble Group here with our thorough financial health report.

Sweco (OM:SWEC B)

Overview: Sweco AB (publ) provides architecture and engineering consultancy services worldwide and has a market cap of SEK62.10 billion.

Operations: Sweco's revenue segments include SEK8.74 billion from Sweden, SEK3.97 billion from Belgium, SEK3.67 billion from Finland, SEK3.50 billion from Norway, SEK3.24 billion from Denmark, SEK3.00 billion from the Netherlands, SEK2.71 billion from Germany & Central Europe, and SEK1.47 billion from the UK.

Estimated Discount To Fair Value: 16%

Sweco, trading at SEK 172.9, is currently undervalued compared to an estimated fair value of SEK 205.95. Recent earnings reports show a solid performance with Q2 sales reaching SEK 8.08 billion and net income at SEK 540 million, reflecting strong cash flow generation. The company has secured several high-value contracts, including a SEK 400 million project for the Swedish Transport Administration and strategic partnerships in green hydrogen production, bolstering its future revenue streams and profitability prospects.

• Upon reviewing our latest growth report, Sweco's projected financial performance appears quite optimistic.
• Navigate through the intricacies of Sweco with our comprehensive financial health report here.

Turning Ideas Into Actions

• Embark on your investment journey to our 50 Undervalued Swedish Stocks Based On Cash Flows selection here.
• Are you invested in these stocks already? Keep abreast of every twist and turn by setting up a portfolio with Simply Wall St, where we make it simple for investors like you to stay informed and proactive.
• Simply Wall St is your key to unlocking global market trends, a free user-friendly app for forward-thinking investors.

Curious About Other Options?

• Explore high-performing small cap companies that haven't yet garnered significant analyst attention.
• Diversify your portfolio with solid dividend payers offering reliable income streams to weather potential market turbulence.
• Fuel your portfolio with companies showing strong growth potential, backed by optimistic outlooks both from analysts and management.

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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