5 Undervalued European Stocks

Morningstar Director of Equity Research for Europe Alex Morozov highlights five stocks which are trading significantly below their fair value

Alex Morozov, CFA 2 July, 2018 | 2:19PM

BT is trading below its fair value estimate according to Morningstar equity analysts

Telefonica SA (TEF)

Telefonica is leading the European communications market into converged services. Additionally, it is laying extensive amounts of fibre to better compete with cable operators in providing fixed broadband services.

It acquired E-Plus in Germany and GVT in Brazil, which strengthens its position in both countries and provides lots of opportunities for cost savings. We don't believe the market appreciates how well the firm is positioned and its margin expansion opportunities, which has caused its stock to trade at a wide discount to our fair value estimate.

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The information contained within is for educational and informational purposes ONLY. It is not intended nor should it be considered an invitation or inducement to buy or sell a security or securities noted within nor should it be viewed as a communication intended to persuade or incite you to buy or sell security or securities noted within. Any commentary provided is the opinion of the author and should not be considered a personalised recommendation. The information contained within should not be a person's sole basis for making an investment decision. Please contact your financial professional before making an investment decision.

Securities Mentioned in Article

Security NamePriceChange (%)Morningstar
Rating
BT Group PLC113.55 GBX-1.77
GEA Group AG31.36 EUR1.55
Imperial Brands PLC1,423.00 GBX-1.35
Roche Holding AG Dividend Right Cert.339.20 CHF2.31
Telefonica SA4.17 EUR0.00

About Author

Alex Morozov, CFA  Alex Morozov is the director of the health-care team at Morningstar.

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