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Exploring Nexans (ENXTPA:NEX) Valuation After Recent Share Movement Pauses

Simply Wall St · 09/09 15:48
Nexans (ENXTPA:NEX) shares have moved just slightly in the past day, but even low-profile days like this can get investors thinking. Is there a story developing beneath the surface? With no dramatic news driving the latest shift, some may wonder whether the market’s quiet confidence is a signal or simply a pause before the next chapter for this cable and electrification giant. Stepping back, Nexans has experienced moderate growth over the past year, delivering a total return of 15% and finishing the past three years with a gain close to 39%. Recent trading has been mixed, with some short-term pullback in the past month but major gains building over the past quarter, hinting at shifting momentum. Interestingly, this comes as the company’s latest financials show shrinking revenue and net income, adding another layer to the story. This brings us to the real question: after this year’s gains and recent volatility, is Nexans offering investors a bargain, or is the market fully pricing in the future trajectory for this stock?

Most Popular Narrative: 2% Undervalued

The most followed narrative currently sees Nexans trading just below fair value, indicating a modest opportunity for value-seeking investors. This view balances optimism about growth with caution regarding sector challenges.

A strengthened balance sheet with near-zero net debt, strong free cash flow, and substantial liquidity creates flexibility for M&A, investments in green/recyclable cable production, and innovation. These factors support long-term earnings growth and higher return on capital employed.

Want to uncover what puts Nexans in this sweet spot? The backbone of this valuation is built on bold financial assumptions and future margin improvements, shifting expectations for both revenue and earnings. Curious about the analyst numbers that could spark a bigger debate? This narrative bases its fair value on forecasts only the most plugged-in investors are tracking.

Result: Fair Value of €130.71 (UNDERVALUED)

Have a read of the narrative in full and understand what's behind the forecasts.

However, ongoing margin pressure or a sudden shift in industry dynamics could quickly challenge the upbeat view analysts currently hold for Nexans.

Find out about the key risks to this Nexans narrative.

Another View: Discounted Cash Flow Perspective

While the current narrative points to Nexans being slightly undervalued, our DCF model presents a more cautious picture and suggests the share price could be running ahead of underlying cash flow value. Which approach will prove more accurate as the market shifts?

Look into how the SWS DCF model arrives at its fair value.

NEX Discounted Cash Flow as at Sep 2025
NEX Discounted Cash Flow as at Sep 2025

Simply Wall St performs a discounted cash flow (DCF) on every stock in the world every day (check out Nexans for example). We show the entire calculation in full. You can track the result in your watchlist or portfolio and be alerted when this changes, or use our stock screener to discover undervalued stocks based on their cash flows. If you save a screener we even alert you when new companies match - so you never miss a potential opportunity.

Build Your Own Nexans Narrative

Not convinced by these perspectives, or eager to run your own numbers? It takes just a few minutes to craft a narrative that reflects your own outlook. Do it your way.

A great starting point for your Nexans research is our analysis highlighting 3 key rewards and 2 important warning signs that could impact your investment decision.

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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.