Atte has published a new company report on Aallon Group
We reiterate our target price of EUR 13.0 for Aallon Group, but following the share price decline, we are upgrading our recommendation to Buy (prev. Accumulate). We have included the company’s two latest small acquisitions in our forecasts, the impact of which on the earnings forecasts for the coming years was only around 1%. However, Aallon Group’s share price has been declining since our last update, and the valuation (2026e adj. P/E 10x) looks attractive in our view relative to the company’s steady and strong cash-flow-generating business and medium-term earnings growth prospects.
Additionally, the number of shares has increased by less than 10% (3.6m → 3.9m → 3.8m) as the company became active in repurchasing its own shares.
Dividends have also been paid increasingly, totaling €1.23/share since the IPO.
Edit: A new CFO has been appointed. That happened quite quickly.
Henri Enola has strong experience in developing financial management for listed companies, financial transformation projects, IPO projects, M&A, and IFRS reporting, among others. Previously, Enola has served as a director in financial management advisory services at EY and, before that, at Nokia. He holds a Master of Science in Economics and Business Administration.
Here is Atte’s preview as Aallon Group reports its H2 results on Thursday, February 12, 2026
We expect the company’s H2 revenue to have grown strongly, driven by acquisitions, but organic growth to have remained slightly negative as the Finnish economy stayed sluggish. Regarding the results, interest is focused especially on the profitability of the end of the year, which has been affected by the ongoing organizational restructuring and related one-off costs. Adjusted for one-off items, we expect Aallon Group’s result to have grown, supported by the acquisitions made. The reforms carried out this year should gradually begin to bring more efficiency to the company’s operations.
At times, I’ve wondered the same thing—that the market hasn’t really appreciated this performance. Of course, that period included a pretty massive repricing of stocks as the interest rate environment changed drastically after the long zero-interest-rate era. Followed by the misery of the Finnish economy and a proper small-cap bear market, it’s no wonder the share price isn’t going anywhere despite the good performance
However, it makes me wonder if the market might be farsighted, already discounting a drying up of the acquisition pipeline or some other deterioration of the process. In Aallon’s sector, suitable targets aren’t necessarily available indefinitely in the domestic market alone, and the industry is being consolidated from many directions simultaneously. Furthermore, the industry is relatively people-driven, which brings its own risks regarding the continuity of the acquired companies—something that has already been discussed at length in this thread.
Also, the low share ownership of the management team and the board bothers me; I’d like to see more of it, given that the investment case relies heavily on successful capital allocation—meaning, in practice, success in acquisitions. Granted, they have succeeded quite well in that historically.
Or is this actually the exact moment when one should get excited about these Helsinki small-caps, and my skepticism is just caused by this lengthy small-cap bear market and the misery of the Finnish economy? Of course, at the current valuation, Aallon could be a decent investment for the next Finnish economic upturn (will there even be one anymore? ), even if it doesn’t turn out to be a value-creating “compounder” fueled by acquisitions for decades to come.
