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Is Veidekke (OB:VEI) Fairly Valued On Its New Hamar Contract?

Simply Wall St · 1d ago

Veidekke (OB:VEI) just secured a new design and build contract for the first phase of the "Vannlinja" residential project in Hamar, valued at about NOK 300 million, with an option for a second phase.

Veidekke’s latest Hamar contract lands after a stretch where the stock has cooled in the very short term, with the 7 day share price return down 5.98% and the 30 day return down 2.54%. However, momentum over longer periods remains positive, with a 90 day share price return of 6.73%, year to date share price gains of 14.04% and a 1 year total shareholder return of 35.40%, supported by very strong 3 year and 5 year total shareholder returns above 150%.

Scan for other construction and infrastructure players showing similar contract momentum to Veidekke by jumping into our curated list of list of solid balance sheet and fundamentals (202 results)

Bulls see Veidekke’s contract wins and solid multi year returns as evidence that the current valuation still has support. Bears point to the recent pullback and cyclical risks. As valuation comes into focus, which case do the numbers support?

Preferred P/E of 16.1x: Is it justified?

Veidekke trades on a P/E of 16.1x, and that sits slightly above both its estimated fair P/E and the wider European construction sector, even as the stock changes hands at NOK199.8.

The P/E ratio compares the current share price with earnings per share. For a construction and infrastructure group like Veidekke, it effectively shows how much investors are willing to pay for each krone of current profit, given its contract pipeline and earnings profile.

On the one hand, Veidekke is described as trading at a 10.8% discount to an estimate of fair value and NOK199.8 per share is below an internal future cash flow value estimate of NOK224.09. On the other hand, that 16.1x earnings multiple is higher than the European construction P/E average of 15.3x and sits slightly above the estimated fair P/E of 15.8x, which suggests the market already prices in a relatively strong earnings outlook and leaves less room for error if growth or margins soften.

That combination means the stock is not cheap against its sector on simple earnings, even if model based fair value work points to some upside that the broader market could move towards over time.

Explore the SWS fair ratio for Veidekke.

Result: Price-to-earnings of 16.1x (OVERVALUED).

Still, Veidekke’s cyclical exposure and any slowdown in contract awards or project margins could quickly challenge the current P/E premium and fair value story.

Find out about the key risks to this Veidekke narrative.

Another View on Veidekke: DCF Signals Undervaluation

The earlier P/E work suggested Veidekke looks a bit rich against the European construction average, even if peer comparisons are more forgiving. The SWS DCF model tells a different story. On that approach, NOK199.8 per share sits below an estimated future cash flow value of NOK224.09, which points to the stock trading at a discount.

That gap is not huge. Yet for investors weighing contract wins, strong returns on equity and cyclical risk, it raises a simple question: Is the current price offering a modest cushion, or is the earnings multiple already doing most of the heavy lifting for Veidekke’s valuation?

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

VEI Discounted Cash Flow as at Oct 2026
VEI Discounted Cash Flow as at Oct 2026

Simply Wall St performs a discounted cash flow (DCF) on every stock in the world every day (check out Veidekke 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 181 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

Mixed signals on Veidekke’s valuation story so far. Move quickly, check the full data for yourself, and weigh both the 3 key rewards and 1 important warning sign.

Looking for more Veidekke sized investment ideas?

If Veidekke has you thinking harder about pricing power and resilience, do not stop here. The next opportunity on your list could be just a screen away.

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.