Arendals Fossekompani ASA (AFK.OL) | Investment Case

1. Company Snapshot

1.a. Company Description

Arendals Fossekompani ASA, an industrial investment company, owns and operates hydropower plants.It also provides business-critical software and technology services for power generation, power transmission and distribution, and infrastructure.In addition, the company manufactures and sells materials for 3D printing in the aerospace, medical, and automotive sectors; and nanomaterials for electronics and batteries industries, as well as offers satellite communications and IT solutions.

Further, it delivers green power technology based on induction technology; offers voice and data services; and owns and develops various properties.The company operates in Norway, rest of Europe, Asia, and North America.Arendals Fossekompani ASA was founded in 1896 and is headquartered in Arendal, Norway.

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1.b. Last Insights on AFK

Arendals Fossekompani ASA's recent performance has been driven by the company's strong fundamentals and growth potential, as evidenced by the pan-European STOXX Europe 600 Index reaching new highs and key indices like Germany's DAX and France's CAC 40 posting gains. The company's solid positioning within its respective industry, as highlighted in the recent article "Spadel And 2 Other Promising Small Caps with Solid Potential", suggests that it is well-equipped to navigate market uncertainties and capitalize on potential opportunities. Additionally, the company's focus on innovative strategies and products, as mentioned in the article "Philogen And 2 Other European Small Caps With Promising Potential", positions it for success in a dynamic market environment.

1.c. Company Highlights

Last Price	169
Change Percentage	0.90%
Open	168.5
Previous Close	167.5
Market Cap ( Millions)	9288
Volume	4487
Year High	178
Year Low	119
M A 50	158.23
M A 200	139.66

FCF Yield	-0.59%
Dividend Yield	0.59%
ROE	10.32%
Debt / Equity	38.25%
Net Debt / EBIDTA	28.35%
Price To Book	1.8
Price Earnings Ratio	16.41
Price To FCF	-168.88
Price To sales	2.51
EV / EBITDA	7.56

2. Transcript Summary

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3. NewsRoom

Arendals Fossekompani ASA (FRA:5VZ) Q4 2025 Earnings Call Highlights: Navigating Challenges ...

Feb -20

Source:

Exploring Europe's Undiscovered Stock Gems This February 2026

Feb -13

Source:

Volue Welcomes TA Associates as New Strategic Investor

Feb -13

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Undiscovered Gems in Europe To Explore This February 2026

Feb -13

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Caisse Régionale de Crédit Agricole Mutuel Alpes Provence Société coopérative And 2 Other Undiscovered Gems In Europe With Solid Foundations

Feb -12

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Undiscovered Gems in Europe to Watch This February 2026

Feb -12

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Exploring Undiscovered Gems in Europe This February 2026

Feb -11

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Next Geosolutions Europe And 2 Promising Small Caps To Enhance Your Portfolio

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4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (8.83%)

6. Segments

ENRX

Expected Growth: 8.23%

ENRX's 8.23% growth is driven by increasing demand for renewable energy, government incentives for green projects, and Arendals Fossekompani ASA's strategic expansion into new markets, leveraging its expertise in hydroelectric power generation and grid infrastructure development.

Volue

Expected Growth: 10.27%

Arendals Fossekompani ASA's 10.27% growth is driven by increasing demand for renewable energy, government incentives for hydroelectric power, and strategic expansion into new markets. Additionally, the company's focus on operational efficiency and cost reduction has contributed to improved profitability, enabling investments in growth initiatives.

NSSL Global

Expected Growth: 8.97%

NSSL Global's 8.97% growth is driven by increasing demand for satellite communication services, expansion into new markets, and strategic partnerships. The company's focus on innovation, cost-effective solutions, and strong relationships with key customers also contribute to its growth. Additionally, the acquisition by Arendals Fossekompani ASA provides access to new resources and expertise, further fueling growth.

Hydropower

Expected Growth: 6.47%

Arendals Fossekompani ASA's 6.47% hydropower growth is driven by increasing demand for renewable energy, favorable government policies, and declining production costs. Additionally, Norway's abundant water resources and existing infrastructure support the growth of hydropower generation. Furthermore, the company's focus on operational efficiency and capacity upgrades also contribute to its growth momentum.

Tekna

Expected Growth: 10.27%

Tekna's 10.27% growth is driven by increasing demand for its specialized alloy powders in the 3D printing industry, coupled with its strategic expansion into the Asian market. Additionally, the company's focus on research and development has led to the introduction of new products, further boosting revenue growth.

Ampwell

Expected Growth: 10.98%

Ampwell's 10.98% growth is driven by increasing demand for renewable energy solutions, strategic partnerships, and expansion into new markets. Additionally, Arendals Fossekompani ASA's strong financial position and commitment to innovation have enabled Ampwell to invest in R&D, enhancing its product offerings and competitiveness.

Alytic

Expected Growth: 10.27%

Alytic's 10.27% growth is driven by increasing demand for renewable energy solutions, strategic partnerships, and expansion into new markets. The company's focus on innovation, cost reduction, and operational efficiency also contribute to its growth. Additionally, the rising need for sustainable and environmentally friendly practices in the industry supports Alytic's growth momentum.

Eliminations

Expected Growth: 4.83%

Arendals Fossekompani ASA's 4.83% growth is driven by increasing demand for renewable energy, favorable regulatory policies, and strategic investments in hydroelectric power plants. Additionally, the company's focus on operational efficiency and cost reduction initiatives have contributed to the growth.

Property

Expected Growth: 6.4%

Arendals Fossekompani ASA's 6.4% growth is driven by increasing demand for renewable energy, government incentives for hydropower production, and strategic expansion into new markets. Additionally, the company's focus on operational efficiency and cost reduction measures have contributed to its growth momentum.

Group Management

Expected Growth: 8.5%

Arendals Fossekompani ASA's Group Management drives 8.5% growth through strategic investments in renewable energy, efficient operations, and cost reductions. Strong leadership and a focused organizational structure enable effective resource allocation, while a commitment to innovation and R&D fuels long-term expansion.

Vergia

Expected Growth: 4.73%

Vergia's 4.73% growth is driven by increasing demand for renewable energy, government incentives for green infrastructure, and strategic partnerships. Additionally, Arendals Fossekompani ASA's focus on sustainable operations and cost reductions have improved efficiency, contributing to the segment's growth.

7. Detailed Products

Hydroelectric Power

Arendals Fossekompani ASA generates and sells hydroelectric power to the Norwegian power grid, providing clean and renewable energy to households and businesses.

Water Management

The company offers water management services, including water storage, flood control, and irrigation systems, to support agriculture, industry, and municipal water supply.

Real Estate Development

Arendals Fossekompani ASA develops and manages commercial and residential properties, including office spaces, apartments, and recreational areas.

Tourism and Recreation

The company offers tourism and recreational activities, such as hiking, fishing, and skiing, in the surrounding areas of its hydroelectric power plants.

8. Arendals Fossekompani ASA's Porter Forces

Forces Ranking

Threat Of Substitutes

Arendals Fossekompani ASA operates in the renewable energy sector, which has a moderate threat of substitutes. While there are alternative energy sources, the company's focus on hydroelectric power provides a unique selling proposition.

Bargaining Power Of Customers

Arendals Fossekompani ASA's customers are primarily industrial and commercial entities, which have limited bargaining power due to the company's dominant market position and lack of alternative suppliers.

Bargaining Power Of Suppliers

Arendals Fossekompani ASA relies on a few key suppliers for equipment and services, which gives them some bargaining power. However, the company's scale and reputation mitigate this risk.

Threat Of New Entrants

The renewable energy sector has high barriers to entry, including significant capital requirements and regulatory hurdles, making it difficult for new entrants to challenge Arendals Fossekompani ASA's market position.

Intensity Of Rivalry

Arendals Fossekompani ASA operates in a moderately competitive market, with a few established players. While there is some rivalry, the company's strong brand and market position help to mitigate this risk.

9. SWOT Analysis

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

	Value
Debt Weight	46.27%
Debt Cost	8.43%
Equity Weight	53.73%
Equity Cost	8.43%
WACC	8.43%
Leverage	86.11%

11. Quality Control: Arendals Fossekompani ASA passed 3 out of 9 key points

Strong Liquidity

Low Deb

Strong Interest Coverage

Healthy Cash Flow

Operating Efficiency

Strong Return On Equity

Consistent Revenue Growth

Consistent Operating Cash Flow Growth

Margin Improvement

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

GPI

A-Score: 6.0/10

Value: 5.4

Growth: 6.8

Quality: 3.1

Yield: 8.1

Momentum: 8.5

Volatility: 4.0

1-Year Total Return ->

Nolato

A-Score: 5.4/10

Value: 3.2

Growth: 4.3

Quality: 5.7

Yield: 7.5

Momentum: 6.0

Volatility: 5.7

1-Year Total Return ->

Arendals Fossekompani

A-Score: 5.3/10

Value: 6.0

Growth: 4.8

Quality: 7.6

Yield: 5.0

Momentum: 3.0

Volatility: 5.3

1-Year Total Return ->

Volati

A-Score: 5.1/10

Value: 4.1

Growth: 6.3

Quality: 4.6

Yield: 5.6

Momentum: 6.5

Volatility: 3.7

1-Year Total Return ->

Bergman & Beving

A-Score: 4.1/10

Value: 4.8

Growth: 3.3

Quality: 2.7

Yield: 3.1

Momentum: 5.5

Volatility: 5.3

1-Year Total Return ->

BayWa

A-Score: 3.5/10

Value: 10.0

Growth: 4.3

Quality: 5.4

Yield: 1.2

Momentum: 0.0

Volatility: 0.0

1-Year Total Return ->

Peers Metrics

12.e Scoring ^Insights

12.f DCF ^BETA

Parameters

Short Term Growth

55.19%

Short term Time

10.0

Long-Term Growth

2.00%

WACC

8.43%

Arendals Fossekompani ASA - NO0003572802

1. Company Snapshot

1.a. Company Description

1.b. Last Insights on AFK

1.c. Company Highlights

Lower Growth

Weak Momentum

Average Yield

Higher Yield

Stable Momentum

Earnings Beats

Revenues Beats

Lower Quality

Medium Volatility

Average Quality

Earnings Miss

Better Quality

Average Growth

2. Transcript Summary

3. NewsRoom

4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (8.83%)

6. Segments

ENRX

Expected Growth: 8.23%

Volue

Expected Growth: 10.27%

NSSL Global

Expected Growth: 8.97%

Hydropower

Expected Growth: 6.47%

Tekna

Expected Growth: 10.27%

Ampwell

Expected Growth: 10.98%

Alytic

Expected Growth: 10.27%

Eliminations

Expected Growth: 4.83%

Property

Expected Growth: 6.4%

Group Management

Expected Growth: 8.5%

Vergia

Expected Growth: 4.73%

7. Detailed Products

Hydroelectric Power

Water Management

Real Estate Development

Tourism and Recreation

8. Arendals Fossekompani ASA's Porter Forces

Forces Ranking

Threat Of Substitutes

Bargaining Power Of Customers

Bargaining Power Of Suppliers

Threat Of New Entrants

Intensity Of Rivalry

9. SWOT Analysis

Strength

Weaknesses

Opportunities

Threats

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

11. Quality Control: Arendals Fossekompani ASA passed 3 out of 9 key points

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

Peers Metrics

12.e Scoring Insights

12.f DCF BETA

Parameters

Short Term Growth

Short term Time

Long-Term Growth

12.e Scoring ^Insights

12.f DCF ^BETA