Diebold Nixdorf (DBD) just set a new marker for its ATM outsourcing ambitions, announcing a planned global collaboration with Euronet Worldwide that pairs hardware, software and processing capabilities into a combined service offering.
Against this backdrop, Diebold Nixdorf’s 1 month share price return of 9.73% and 7.60% share price gain year to date suggest momentum has picked up again. This comes even though the stock is still down 24.17% on a 3 month share price basis and has delivered a much stronger 3 year total shareholder return of about 3.6x.
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Diebold Nixdorf now trades at a steep discount to both analyst targets and implied fair value, even after the recent rebound. Is that a margin of safety, or a warning the market still sees real risk ahead?
Most Popular Narrative: 30% Undervalued
Against a last close of $68.82, the most followed narrative on Diebold Nixdorf points to a fair value of $98.33, which implies a sizeable valuation gap that rests heavily on execution of contract wins and backlog conversion.
Localized and scaled manufacturing, including added production lines in Paderborn without higher operating costs, footprint reductions with higher capacity in Brazil and record teller cash recycler output in North Canton, is combining with the fit-for-purpose platform in Asia Pacific to support efficient fulfillment of backlog in regions like India and Latin America while reinforcing product gross margin and cash conversion from the US$814 million order book.
See why 3 investors see Diebold Nixdorf as 30% undervalued.
Result: Fair Value of $98.33 (UNDERVALUED)
Still, the bullish story around Diebold Nixdorf can weaken quickly if converting the US$814 million backlog stalls, or if service margin pressure lingers longer than analysts model.
Find out about the key risks to this Diebold Nixdorf narrative.
Next Steps
Mixed messages on Diebold Nixdorf so far. If you want to move quickly and sharpen your own view, consider weighing both sides by checking the 4 key rewards and 2 important warning signs.
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