Norwegian Stock Analysis Report
Analysis of Norwegian stocks with low capital raise risk and undervaluation indicators
Report Date: June 16, 2025
Executive Summary
This report presents an analysis of Norwegian stocks listed on Nordnet Norway, focusing on identifying companies with low risk of needing capital raise and showing undervaluation indicators. From an initial dataset of 311 Norwegian stocks, 30 were analyzed in detail, and 2 stocks met all our filtering criteria:
- Norsk Hydro ASA (NHY) - A leading aluminum and renewable energy company
- Hafnia Limited (HAFNI) - A shipping company specializing in oil and petroleum products transportation
These stocks demonstrate strong financial health with reasonable debt levels, positive earnings, and attractive valuations relative to the Norwegian market averages.
Methodology
Filtering Criteria
Low Capital Raise Risk Criteria
- Liquidity: Current Ratio > 1.2 (indicates good short-term financial health)
- Debt Level: Debt/Equity Ratio < 50 (indicates reasonable leverage)
- Profitability: Positive P/E Ratio (indicates the company is profitable)
Undervaluation Criteria
- P/E Ratio: Below 12.36 (below the Norwegian market average of 12.36)
- P/B Ratio: Below 5 (reasonable valuation relative to book value)
- Return on Equity: Above 8.7% (above the average required return to equity in Norway)
Data Sources
- Financial data from Nordnet Norway
- Market benchmarks from Oslo Børs
- Industry averages from financial research
Analysis Process
- Data collection from Nordnet Norway
- Application of filtering criteria
- Visualization of key relationships
- Identification of stocks meeting all criteria
Limitations
- Analysis based on current financial data without historical trends
- Limited sample size of 30 stocks with detailed financial metrics
- Reliance on publicly available data which may have reporting lags
Market Context
The Norwegian stock market, as represented by the Oslo Stock Exchange Benchmark Index (OSEBX), has been showing positive trends with an index level around 1,627.37 as of June 13, 2025. The market has a capitalization of approximately 351.244 USD billion.
The Oslo Børs is particularly strong in three key sectors:
- Energy
- Shipping
- Seafood
Current Norwegian market averages that were used as benchmarks in our analysis:
- Average P/E Ratio: 12.36
- Average Required Return to Equity: 8.7%
Filtered Stocks Analysis
Overview of Selected Stocks
| Symbol | Company Name | Market Cap (B NOK) | Stock Price (NOK) | Revenue (B NOK) | % Change |
|---|---|---|---|---|---|
| NHY | Norsk Hydro ASA | 109.09 | 55.24 | 213.19 | -1.53% |
| HAFNI | Hafnia Limited | 27.07 | 54.36 | 27.68 | 1.95% |
Financial Metrics
| Symbol | P/E Ratio | P/B Ratio | Debt/Equity | Current Ratio | ROE (%) |
|---|---|---|---|---|---|
| NHY | 11.32 | 1.06 | 34.03 | 1.65 | 9.48 |
| HAFNI | 4.51 | 1.18 | 46.81 | 1.23 | 26.66 |
Company Profiles
Norsk Hydro ASA (NHY)
Norsk Hydro is a Norwegian aluminum and renewable energy company with operations in 40 countries. The company is one of the largest aluminum companies worldwide and has a significant presence in hydropower production. Key observations:
- Strong market position with 109.09B NOK market capitalization
- Attractive P/E ratio of 11.32, below the market average
- Very low P/B ratio of 1.06, indicating potential undervaluation
- Healthy current ratio of 1.65, suggesting good short-term liquidity
- ROE of 9.48%, above the average required return to equity in Norway
Hafnia Limited (HAFNI)
Hafnia Limited is a shipping company that specializes in the transportation of oil and petroleum products. The company operates a modern fleet of vessels and is listed on the Oslo Stock Exchange. Key observations:
- Exceptionally low P/E ratio of 4.51, significantly below market average
- Low P/B ratio of 1.18, suggesting potential undervaluation
- Manageable debt-to-equity ratio of 46.81
- Adequate current ratio of 1.23, indicating sufficient short-term liquidity
- Outstanding ROE of 26.66%, significantly above market average
Visualizations
P/E Ratio vs P/B Ratio
This chart shows the relationship between P/E Ratio and P/B Ratio for the analyzed stocks. The highlighted points (in red) represent the stocks that meet all our filtering criteria.
Debt/Equity Ratio vs Current Ratio
This chart illustrates the relationship between Debt/Equity Ratio and Current Ratio. Stocks in the lower right quadrant typically have lower debt and better liquidity.
ROE vs P/E Ratio
This chart shows the relationship between Return on Equity (ROE) and P/E Ratio. Stocks with high ROE and low P/E (upper left quadrant) may represent good value.
Market Cap vs ROE
This chart displays the relationship between Market Capitalization and Return on Equity (ROE). It helps identify companies of different sizes with strong profitability.
Conclusions and Investment Considerations
Key Findings
- Only 2 out of 30 analyzed stocks (6.7%) met all our strict filtering criteria
- Both selected stocks show strong financial health and attractive valuations
- Hafnia Limited (HAFNI) shows particularly strong ROE and low P/E ratio
- Norsk Hydro (NHY) offers a balanced profile with good metrics across all categories
Investment Considerations
- Sector Diversification: The two stocks represent different sectors (materials and shipping), offering some diversification
- Risk Assessment: Both companies show low risk of needing capital raise based on our criteria
- Valuation: Both stocks appear undervalued relative to the Norwegian market averages
- Further Research: Investors should conduct additional research on company-specific factors, industry trends, and future growth prospects
Limitations and Disclaimers
This analysis is based on current financial data and does not account for future market conditions or company-specific developments. Investment decisions should not be made solely based on this report. Always conduct thorough due diligence and consider consulting with a financial advisor before making investment decisions.