As the European economy shows signs of revitalization, particularly with the Paris Olympics driving business activity, investors are keenly observing opportunities on Euronext Paris. With major indices like France's CAC 40 Index gaining momentum, it's an opportune time to consider stocks that might be undervalued in this buoyant market environment. In such a setting, identifying stocks that have strong fundamentals but are currently trading below their intrinsic value can offer significant potential for growth. Here are three stocks on Euronext Paris that might be undervalued and worth your attention.

Top 10 Undervalued Stocks Based On Cash Flows In France

Click here to see the full list of 16 stocks from our Undervalued Euronext Paris Stocks Based On Cash Flows screener.

We're going to check out a few of the best picks from our screener tool.

Safran

Overview: Safran SA, with a market cap of €82.65 billion, operates globally in the aerospace and defense sectors through its subsidiaries.

Operations: The company's revenue segments include €2.73 billion from Aircraft Interiors, €12.66 billion from Aerospace Propulsion, and €9.91 billion from Aeronautical Equipment, Defense and Aerosystems.

Estimated Discount To Fair Value: 35.3%

Safran SA reported H1 2024 revenue of €13.41 billion, up from €11.36 billion a year ago, but net income dropped to €57 million from €1.86 billion due to increased costs and investments. Despite lower profit margins, Safran is trading at 35% below its estimated fair value of €303.7 per share and is expected to grow earnings by 21% annually over the next three years, outpacing the French market's growth rate.

• The analysis detailed in our Safran growth report hints at robust future financial performance.

• Click to explore a detailed breakdown of our findings in Safran's balance sheet health report.

SPIE

Overview: SPIE SA offers multi-technical services in energy and communications across France, Germany, the Netherlands, and internationally, with a market cap of €5.80 billion.

Operations: Revenue segments include €1.89 billion from North-Western Europe and €684.90 million from Global Services Energy.

Estimated Discount To Fair Value: 30.3%

SPIE (€34.76) is trading at 30.3% below its estimated fair value of €49.85, indicating significant undervaluation based on discounted cash flows. Despite a high level of debt and an unstable dividend track record, SPIE's earnings are forecast to grow significantly at 20.1% per year, outpacing the French market's growth rate of 12.3%. Recent H1 2024 results showed increased sales (€4.66 billion) but lower net income (€56.75 million).

• Our expertly prepared growth report on SPIE implies its future financial outlook may be stronger than recent results.

• Get an in-depth perspective on SPIE's balance sheet by reading our health report here.

Vivendi

Overview: Vivendi SE is an entertainment, media, and communication company operating globally with a market cap of approximately €10.04 billion.

Operations: Vivendi SE generates revenue through various segments, including Canal+ Group (€6.20 billion), Havas Group (€2.92 billion), Gameloft (€304 million), Prisma Media (€303 million), Vivendi Village (€151 million), New Initiatives (€176 million), and Segment Adjustment (€4.86 billion).

Estimated Discount To Fair Value: 44.9%

Vivendi (€9.96) is trading significantly below its estimated fair value of €18.07, highlighting its undervaluation based on discounted cash flows. Despite an unstable dividend track record and a low forecasted Return on Equity (5.6% in three years), Vivendi's earnings are expected to grow significantly at 30.6% per year, outpacing the French market's growth rate of 12.3%. Recent H1 2024 results showed sales doubling to €9 billion but net income slightly decreasing to €159 million.

• The growth report we've compiled suggests that Vivendi's future prospects could be on the up.

• Click here and access our complete balance sheet health report to understand the dynamics of Vivendi.

Key Takeaways

• Take a closer look at our Undervalued Euronext Paris Stocks Based On Cash Flows list of 16 companies by clicking here.

• Got skin in the game with these stocks? Elevate how you manage them by using Simply Wall St's portfolio, where intuitive tools await to help optimize your investment outcomes.

• Take control of your financial future using Simply Wall St, offering free, in-depth knowledge of international markets to every investor.

Seeking Other Investments?

• 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.

Companies discussed in this article include ENXTPA:SAF ENXTPA:SPIE and ENXTPA:VIV.

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