Undiscovered gems in Sweden to see this October 2024

Operations: Proact IT Group AB’s revenue sources come primarily from its activities in the Nordic and Baltic countries, which contribute SEK 2.59 billion, followed by Central Europe (Czech Republic and Germany) with SEK 877 million and the West (Belgium and Netherlands) with 834 million SEK million.

Sweden’s Proact IT Group looks to be an interesting player in the IT sector, as its profit growth of 41.7% last year was well above the industry average of -6.3%. The company appears to be trading at a significant discount, 40.8% below its estimated fair value, suggesting potential upside for investors. Financially robust, Proact has reduced its debt-to-equity ratio from 78.3% to 48.8% over five years and maintains strong interest coverage, with EBIT covering interest payments by 32x. Recent leadership changes include the arrival of Jamie Ford as head of the UK business unit, potentially strengthening strategic initiatives.

Simply Wall St Value Rating: ★★★★★★

Overview: Zinzino AB (publ) is a direct selling company offering nutritional supplements and skin care products in Sweden and internationally, with a market capitalization of approximately SEK 3.09 billion.

Operations: Zinzino generates revenue mainly from its Zinzino segment (including VMA Life), which accounts for SEK 1.83 billion, while Faun contributes SEK 170.31 million.

Zinzino, a Swedish company in the retail distribution sector, delivered an impressive performance last year with profit growth of 66.9%, beating the industry average of -3.1%. The company has no debt and is trading 60.5% below its estimated fair value, suggesting possible undervaluation. Recent sales announcements show a robust 39% increase in sales in August to SEK 178.7 million compared to SEK 128.4 million last year. In the second quarter of 2024, net profit increased to SEK 47.99 million from the previous SEK 36.8 million, with basic earnings per share improving from SEK 1.09 to SEK 1.41.

This article from Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts using only an unbiased methodology and our articles are not intended as financial advice. It does not constitute a recommendation to buy or sell any stock and does not take into account your objectives or financial situation. Our goal is to provide you with long-term focused analysis based on fundamental data. Note that our analysis may not reflect 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 OM:BESQAB OM:PACT and OM:ZZ B.

Do you have feedback on this article? Worried about the content? Contact us directly. Alternatively, you can also send an email to editor-team@simplywallst.com