3 European Stocks Estimated To Be Undervalued In March 2025

As European markets navigate a complex landscape of mixed inflation data and economic contractions in major economies, investors are on the lookout for undervalued stocks that offer potential opportunities. In March 2025, several European stocks have been identified as undervalued based on their current valuations and growth prospects. Let's take a closer look at three of these stocks: Recordati Industria Chimica e Farmaceutica (BIT:REC), Salvatore Ferragamo (BIT:SFER), and Gjensidige Forsikring (OB:GJF).



1. Recordati Industria Chimica e Farmaceutica (BIT:REC)
Recordati Industria Chimica e Farmaceutica is a pharmaceutical company with a market cap of approximately €11.10 billion. The company's revenue is primarily derived from its Rare Diseases segment, which accounts for €1.51 billion, and its Specialty & Primary Care segment, contributing €833.61 million. The stock is trading at a 17.3% discount to its estimated fair value of €65.67, indicating that it may be undervalued based on cash flows. Despite a high level of debt, the company maintains a reliable dividend yield of 2.27% and is expected to grow earnings by 11.9% annually, outpacing the Italian market's growth rate of 8%. Recent guidance projects net revenue between €2.6 billion and €2.67 billion for 2025.

2. Salvatore Ferragamo (BIT:SFER)
Salvatore Ferragamo is a luxury goods company with a market cap of approximately €1.34 billion. The company's revenue primarily comes from its footwear segment, which generated €1.08 billion. The stock is trading at a 25.5% discount to its fair value estimate of €10.87, making it significantly undervalued. Despite recent volatility and lower profit margins compared to last year, the company's earnings are projected to grow substantially at 38.57% annually over the next three years, outpacing both its revenue growth and the Italian market's earnings growth rate. However, its Return on Equity is expected to remain low at 4.9%.



3. Gjensidige Forsikring (OB:GJF)
Gjensidige Forsikring is a general insurance and pension products provider with a market cap of NOK115.39 billion. The company's revenue segments include General Insurance Commercial, General Insurance Private, General Insurance Sweden, and Pension products. The stock is priced at NOK 230.8, trading 36.5% below its estimated fair value of NOK 363.63, highlighting its potential undervaluation based on cash flows. Although earnings are projected to grow by 12.58% annually—outpacing the Norwegian market's growth—revenue growth is modest at 3%. Despite a high future Return on Equity forecast of 25.9%, the dividend yield of 3.9% lacks sufficient coverage from free cash flows, posing sustainability concerns.



In conclusion, these three undervalued European stocks offer potential opportunities for investors seeking attractive valuations and growth prospects. However, it is essential to conduct thorough research and consider the specific risks and challenges associated with each company before making an investment decision. As always, it is crucial to maintain a diversified portfolio and stay informed about market developments to maximize potential returns.