NEMKY - Nemetschek: Really Betting On Another 10 Years Of Housing Boom?

2024-04-09 09:56:08 ET

Summary

• Nemetschek reported solid but not outstanding results for fiscal 2023, with revenue and earnings growth in the mid-single digits.
• While the company performed great in the last ten years, Nemetschek did not also grow at such high rates and we see a correlation to the German housing market.
• For the years to come, we should be cautious about high growth rates, as the housing market won't be the same as in the last ten years.
• Without Nemetschek growing in the mid-teens in the coming years, the stock is overvalued.

In my last article about Nemetschek SE ( NEMTF ) published in August 2023 I was rather bearish (or at least very cautious) about the stock as an investment, and I wrote:

Nemetschek already declined about 60% from its previous all-time high and this is already a steep decline. And right now, the stock is still trading almost 50% below its previous all-time high. But I still would be a little cautious if Nemetschek is a good investment already and the stock will only remain on my watchlist for now.

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