Strong stocks, weak prices: Puma, RE Royalties, and TeamViewer - Where it might be worth getting in

Puma – Painful reset with long-term prospects

Puma's current balance sheet does not make for pleasant reading. In the third quarter, revenue slumped by 15% and the Company slipped deep into the red. However, this weakness is largely self-inflicted and part of a radical change of course under new CEO Arthur Hoeld. In order to strengthen the brand in the long term, he is deliberately reducing business with discount-oriented wholesalers, reducing excessive inventories, and cutting hundreds of jobs. This bitter pill is putting massive pressure on revenue and margins in the short term, but is intended to lay the foundation for a sustainable restart.

The short-term figures reflect this shock therapy. The nine-month net loss is approaching the EUR 300 million mark. On a positive note, however, the balance sheet is solid and can support the turnaround. Liquidity is sufficient, and free cash flow is already showing initial improvements. In addition, the continued payment of dividends offers a small anchor. The market is currently extremely skeptical about the Company, with valuation multiples well below those of industry giants Nike and Adidas.

There are two possible paths for shareholders. The first is the successful transformation from 2027 onwards, as announced by management. The second, speculative path is a takeover. Rumors of interest from China, for example, are fueling this hope and causing volatility. However, a deal is by no means certain, as major shareholder Artemis would likely only sell at a significant premium. For risk-conscious investors who believe in the strength of the brand, the current phase of weakness could represent an entry opportunity, combined with the prospect of a patient wait and considerable sales risk. The stock is currently trading at EUR 20.21.

RE Royalties – A stable approach in dynamic times

In the often volatile world of renewable energy, the royalty model offers a compelling path to stable returns. Instead of getting involved in complex project development, this approach focuses on financing existing plants or those nearing completion. In return, long-term agreed shares of revenue are paid out. This model protects against the usual construction and operating risks and generates direct operating cash flows as soon as the projects go online. For investors, this results in clear leverage on the growth of the entire sector with reduced volatility.

The regulatory landscape is driving demand for flexible financing solutions. In Canada, tax credits that have been passed are stabilizing planning for industry. At the same time, the planned massive expansion of grid infrastructure is laying the foundation for long-term growth. In the US, the adjusted subsidy policy has led to remarkable momentum. While certain areas have been adjusted, others, such as energy storage and geothermal energy, continue to benefit. This has triggered a real boost for projects that now need to be implemented quickly. This is an ideal starting point for a financially strong financier.

The Company is facing an unprecedented pipeline. The focus is on two particularly interesting areas: financing acquisitions of already profitable plants at potentially favorable terms, and providing construction loans for projects under time pressure. These projects promise rapid cash flow. Against this backdrop, management is reviewing all options for a capital-efficient strategy. The clear priority is to capitalize on these promising opportunities in order to fully exploit the long-term value creation potential. This prudent, growth-oriented stance could prove to be the more sustainable path for shareholders and could initiate a turnaround in the stock. The share is currently trading at CAD 0.24.

TeamViewer – AI trends drive growth

The AI offensive by software provider TeamViewer is bearing impressive fruit. Since its broad market launch a few months ago, around 10,000 customers are already using the new AI functions, which automatically document and analyze IT support sessions. Acceptance is literally exploding. The number of active users recently recorded monthly growth rates of 60%. For IT teams, this means tangible efficiency gains, such as significantly faster ticket processing. This momentum underscores the potential of AI for the Company's core products.

However, the latest quarterly figures paint a mixed picture. While TeamViewer's traditional enterprise business continued to perform robustly with currency-adjusted ARR growth of 18%, the integration of the acquired company 1E is slowing down the group as a whole. Its business performance fell significantly short of expectations, which weighed on the consolidated forecast for annual recurring revenue (ARR) growth. Profitability remains positive, with an adjusted EBITDA margin of a solid 46%.

Despite short-term difficulties at 1E, management is sticking to its long-term strategy of merging remote maintenance and digital workplace solutions into an intelligent, autonomous platform. The extraordinary demand for AI tools confirms that this is the right direction to take. For the current year, the revenue forecast has been revised slightly downward, but the profit margin expectation has been revised upward due to strict cost management. The focus is now on placing the integrated solutions on the market and accelerating growth in the enterprise sector. The share is currently trading at EUR 5.56.

The analyzed stocks offer opportunities but require different risk tolerances. Puma is undergoing a reset that requires patience. RE Royalties scores with a stable cash flow model in a structurally growing energy market. TeamViewer, on the other hand, is driving its growth with successful AI innovations, but must master the integration of 1E. For long-term oriented investors, the current price weaknesses could mark entry points into fundamental values.