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Alstom (ENXTPA:ALO) Could Be 26% Undervalued Following €270 Million Train Order

Simply Wall St · 1d ago

Alstom (ENXTPA:ALO) is back in focus after the Victorian Government exercised an option for 25 additional X’trapolis 2.0 trains, under a €270 million contract that extends an existing 2021 order.

See our latest analysis for Alstom.

The latest Victorian order lands at a time when Alstom’s short term share price momentum is mixed, with a 1 month share price return of 3.34% but a year to date share price decline of 36.82%, while the 1 year total shareholder return is down 25.48%.

If this contract has you thinking about longer term infrastructure trends, it could be a good moment to scan companies plugged into grid and transport upgrades through the Simply Wall St screener for 40 power grid technology and infrastructure stocks

Bulls see contracts like Victoria’s as proof that Alstom’s current share price weakness is out of sync with its order book. Bears point to multi year share price declines and execution risks. Do the numbers back either side more clearly?

Most Popular Narrative: 25.9% Undervalued

Alstom's most followed valuation narrative places fair value at €21.89 per share, compared with the last close of €16.23, and sets out a detailed case built around earnings, margins and contract execution.

The analysts have a consensus price target of €21.89 for Alstom based on their expectations of its future earnings growth, profit margins and other risk factors.

However, there is a degree of disagreement amongst analysts, with the most bullish reporting a price target of €28.0, and the most bearish reporting a price target of just €10.0.

Read the complete narrative.

Want to see what is driving that valuation gap for Alstom? The narrative leans heavily on stronger earnings, improving margins and a specific profit multiple that needs to hold. The exact mix of revenue growth, margin lift and discounting behind that story is where it gets interesting.

Result: Fair Value of €21.89 (UNDERVALUED)

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

However, Alstom’s heavy legacy contracts and ongoing supply chain pressures could still squeeze margins and cash flow enough to challenge that underpriced story.

Find out about the key risks to this Alstom narrative.

Another View: What Our DCF Model Says About Alstom

While the popular Alstom narrative points to a fair value of €21.89 and a 25.9% undervaluation, the Simply Wall St DCF model comes to a very different conclusion. On that cash flow view, Alstom at €16.23 trades above an estimated value of €3.92, which flags the stock as expensive. So which set of assumptions do you trust more?

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

ALO Discounted Cash Flow as at Aug 2026
ALO Discounted Cash Flow as at Aug 2026

Simply Wall St performs a discounted cash flow (DCF) on every stock in the world every day (check out Alstom 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 258 high quality undervalued stocks. If you save a screener we even alert you when new companies match - so you never miss a potential opportunity.

Next Steps

The mixed messages in this Alstom story make it especially important to look under the hood yourself and not lean on headlines alone. To weigh both the concerns and the potential upside, start by reviewing the 2 key rewards and 1 important warning sign.

Looking for more investment ideas beyond Alstom?

If Alstom has sharpened your focus on opportunities, do not stop here. Fresh ideas often show up where markets pay less attention, so keep widening your search.

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.