As the German economy faces a forecasted contraction for the second consecutive year, investors are increasingly focusing on growth companies with strong fundamentals and insider ownership as potential bright spots amidst broader market challenges. In this context, stocks with significant insider ownership can be appealing due to the alignment of interests between company insiders and shareholders, suggesting confidence in their long-term prospects despite current economic headwinds.
Top 10 Growth Companies With High Insider Ownership In Germany
Overview: adidas AG, along with its subsidiaries, is involved in the design, development, production, and marketing of athletic and sports lifestyle products across various regions including Europe, the Middle East, Africa, North America, Greater China, the Asia-Pacific, and Latin America; it has a market cap of approximately €42.80 billion.
Operations: The company's revenue segments include Greater China with €3.26 billion, Latin America at €2.39 billion, and North America contributing €5.07 billion.
Insider Ownership: 16.6%
adidas AG, with significant earnings growth forecasted at 41.8% annually, has recently raised its full-year guidance following strong quarterly performance. The company reported a net income of €190 million for Q2 2024, up from €84 million the previous year. Despite unfavorable currency effects impacting profitability and revenue, adidas anticipates high-single-digit revenue growth for 2024 and an operating profit around €1 billion. Trading below fair value estimates enhances its appeal amidst robust market outperformance expectations.
Overview: Redcare Pharmacy NV operates an online pharmacy business across the Netherlands, Germany, Italy, Belgium, Switzerland, Austria, and France with a market cap of €2.94 billion.
Operations: The company's revenue is derived from two main segments: DACH, contributing €1.74 billion, and International, contributing €391 million.
Insider Ownership: 17.4%
Redcare Pharmacy, with forecasted earnings growth of 54.29% annually, has raised its full-year sales guidance for 2024 to between €2.35 billion and €2.5 billion. Despite past shareholder dilution, the company trades at a significant discount to estimated fair value and expects revenue growth of 17.5% per year—outpacing the German market average. While insider buying hasn't been substantial recently, profitability is anticipated within three years, marking above-average market growth expectations.
Overview: Zalando SE operates an online platform for fashion and lifestyle products with a market cap of approximately €7.84 billion.
Operations: The company's revenue segments include a Segment Adjustment of €10.49 billion.
Insider Ownership: 10.4%
Zalando is expected to achieve annual earnings growth of 24.4%, surpassing the German market average. Despite a low forecasted return on equity of 12.8% in three years, it trades at a significant discount to its estimated fair value. Recent financial results show robust improvement with net income rising to €95.7 million in Q2 2024, up from €56.6 million the previous year, though there has been no significant insider trading activity recently.
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.The analysis only considers stock directly held by insiders. It does not include indirectly owned stock through other vehicles such as corporate and/or trust entities. All forecast revenue and earnings growth rates quoted are in terms of annualised (per annum) growth rates over 1-3 years.
Companies discussed in this article include XTRA:ADS XTRA:RDC and XTRA:ZAL.
