AVAX coverage is being initiated by Axia-Alpha Finance, setting a target price of €5.10 per share and giving a Buy recommendation. The target price implies upside potential of approximately 63% from current levels.
As the brokerage notes, AVAX’s investment story is based on its ability to undertake and execute large infrastructure and energy projects on time, achieving high margins.
At the same time, the significant backlog of projects creates earnings visibility for about three years, while the favorable environment for infrastructure projects in Greece and the strong demand for EPC energy and grid projects in Europe create additional growth opportunities.
Axia-Alpha estimates that the market has not yet fully priced in the value of AVAX’s construction arm, as well as the significant value of the group’s concessions portfolio and other assets. At the same time, management is examining new opportunities in concessions and PPPs, as well as the potential re-entry into the energy market, targeting photovoltaic and energy storage projects.
Stronger balance sheet
According to the brokerage’s estimates, AVAX’s net leverage is expected to decline significantly, from 2.1 times in 2025 to just 0.4 times in 2030, as borrowing decreases, liquidity strengthens, and the conversion of profits into cash flows improves.
Net profits are estimated to increase from €48 million in 2025 to €75.9 million in 2030, corresponding to an average annual growth rate of 9.6%. The increase will mainly come from construction activity, with concessions gradually making a greater contribution.
More specifically, the contribution of concessions to the group’s EBITDA is expected to increase from 7% today to 23% in 2030. This development, combined with deleveraging, is expected to strengthen AVAX’s financial flexibility and allow both selective investments and sustainable distributions to shareholders. The brokerage forecasts a gradual shaping of the payout ratio at 40%, with the dividend yield for 2027 estimated at 3.7%.
Construction and concessions
Axia-Alpha Finance estimates AVAX’s fair value at €5.10 per share through a Sum-of-the-Parts (SoTP) methodology. The construction sector accounts for 50.7% of the group’s estimated total enterprise value, while concessions account for 36.8%.
An important element of the valuation is the discount versus European comparable companies. Based on estimates for 2027, AVAX is trading at 8.4x P/E and 5.5x EV/EBITDA, versus 14.0x and 6.2x respectively for peers.
According to Axia-Alpha, this discount is not justified by the company’s fundamentals, given the strong cash flow generation, the increasing contribution of recurring revenues, the ongoing deleveraging, and the growth prospects.
The brokerage does, however, acknowledge the concerns associated with delays in the construction of Athens Metro Line 4. It estimates, however, that the final financial impact will depend on the duration of the delay, noting that a limited slippage in timing is not expected to materially alter its forecasts.