On June 10, Carmine De Franco of BNP Paribas Asset Management appeared on CNBC to talk about the European market. He said that European valuations are attractive compared to the US, with strength in the sector accumulating in defense and healthcare rather than technology.
De Franco was of the view that investor attention to Europe is directly related to the fundamental shifts outside the United States, finding ways to diversify portfolios through access to a region with the potential to promote stability and a certain amount of growth which, according to him, may not be as exceptional in the US but at least could be backed by a fundamental driver of performance.
He expects changes to emerge from governments that were previously very skeptical about maintaining a dynamic internal market. Since Europe remains one of the biggest markets on the planet, it could be a very interesting investment case if they can “get their act together.”
De Franco also stated that Europe offers diversification from a sector perspective. While the tech theme is a great one, it is not the only one Europe is playing. Other sectors also warrant attention, as they could benefit from the globalization and reindustrialization shifts emerging in the market.
With these trends in view, let us look at the top 10 undervalued European stocks to invest in now.
Stock market charts. Photo by Kaboompics.com on Pexels
Our Methodology
We used the Finviz stock screener to compile a list of European stocks with a forward P/E ratio under 15 and selected the top 10 stocks most popular among elite hedge funds. The hedge fund data was sourced from Insider Monkey’s database, which tracks the moves of over 1000 elite money managers. The stocks are ranked in ascending order of the number of hedge funds that have stakes in them, as of Q1 2025.
Note: All data was sourced on June 11.
Why are we interested in the stocks that hedge funds pile into? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 373.4% since May 2014, beating its benchmark by 218 percentage points (see more details here).
10 Undervalued European Stocks To Invest In Now
10. Eni S.p.A. (NYSE:E)
Forward P/E: 11.28
Number of Hedge Fund Holders: 9
Eni S.p.A. (NYSE:E) is one of the 10 Undervalued European Stocks to Invest in Now. On June 9, RBC Capital analyst Biraj Borkhataria maintained a Buy rating on Eni S.p.A. (NYSE:E) and set a price target of €18.00.
The company garnered positive investor sentiment following its solid fiscal Q1 2025, which reflected improved financial and economic fundamentals. Eni S.p.A. (NYSE:E) navigated macro-uncertainty and volatility through its flexibility and optionality, with mitigation measures worth over €2 billion in 2025.
Proforma adjusted EBIT for fiscal Q1 2025 rose 36% sequentially in a similar pricing environment to € 3.7 billion, attributed to notable E&P results, steady improvements at the company’s Enilive and Plenitude satellites, and resilient GGP delivery.
Eni S.p.A. (NYSE:E) explores, refines, produces, and sells oil, electricity, gas, and chemicals. Its operations are divided into the following segments: Exploration and Production, Global Gas and LNG Portfolio, Refining & Marketing and Chemicals, Power & Renewables, and Corporate and Other Activities. The company is headquartered in Rome, Italy, making it one of the best undervalued European stocks to invest in now.
9. WPP PLC (NYSE:WPP)
Forward P/E: 7.05
Number of Hedge Fund Holders: 9
WPP PLC (NYSE:WPP) is one of the 10 Undervalued European Stocks to Invest in Now. On June 9, Bank of America Securities analyst Adrien Hilaire maintained a Sell rating on WPP PLC (NYSE:WPP) with a price target of p560.00. The rating came after the company announced on the same day that its CEO, Mark Read, was set to leave in December 2025, resulting in uncertainty about WPP PLC’s (NYSE:WPP) operations.
The analyst based the rating update on the company’s current and future performance, raising concerns about potential near-term negative developments that may occur due to Read’s departure. Hilaire reasoned that while Read rolled out various notable changes, including the launch of WPP Open and the disposal of a stake in Kantar, WPP PLC (NYSE:WPP) has faced complications with the loss of major client relationships, which the analyst anticipates could risk continued losses in 2025.
The company’s organic sales growth also poses a concern for the analyst, who stated that it has been lagging behind Publicis, its closest competitor. WPP PLC’s (NYSE:WPP) 2025 guidance was not reiterated in the recent press release, which, according to the analyst, points towards a potential downward revision, especially since the company reported soft performance in the first half of the year.
Hilaire also stated that WPP PLC (NYSE:WPP) would have to undertake balance sheet readjustments and consider a margin reset if it intends to regain its competitive standing.
Headquartered in London, United Kingdom, WPP PLC (NYSE:WPP) is a creative transformation company that provides communications services. Its operations take place through the Global Integrated Agencies, Public Relations, and Specialist Agencies segments.
8. Banco Bilbao Vizcaya Argentaria, S.A. (NYSE:BBVA)
Forward P/E: 8.27
Number of Hedge Fund Holders: 12
Banco Bilbao Vizcaya Argentaria, S.A. (NYSE:BBVA) is one of the 10 Undervalued European Stocks to Invest in Now. In a report released on June 9, Joseph Dickerson from Jefferies maintained a Buy rating on Banco Bilbao Vizcaya Argentaria, S.A. (NYSE:BBVA) with a price target of €14.20. It is the 8th best undervalued European stock to buy now.
Banco Bilbao Vizcaya Argentaria, S.A. (NYSE:BBVA) recently announced the authorization of the combination of BBVA and Banco Sabadell by the Spanish National Markets and Competition Commission (CNMC) in phase two after an analysis of 11 months. The transaction would result in the second-largest Spanish financial institution, after CaixaBank, in terms of credit volume.
On June 3, Banco Bilbao Vizcaya Argentaria, S.A. (NYSE:BBVA) CEO Peio Belausteguigoitia announced that the proposed integration would be a catalyst to drive growth and thus makes strategic sense by coinciding with the bank’s future objectives.
Banco Bilbao Vizcaya Argentaria, S.A. (NYSE:BBVA) is headquartered in Madrid, Spain, and operates in the traditional banking businesses of asset management, retail banking, private banking, and wholesale banking. Its operations span the United States, Spain, Mexico, Turkey, South America, and the Rest of Eurasia segments.
7. Deutsche Bank Aktiengesellschaft (NYSE:DB)
Forward P/E: 7.82
Number of Hedge Fund Holders: 17
Deutsche Bank Aktiengesellschaft (NYSE:DB) is one of the 10 Undervalued European Stocks to Invest in Now. Bank of America Securities analyst Tarik El Mejjad initiated coverage of Deutsche Bank Aktiengesellschaft (NYSE:DB) with a buy rating on June 10, setting a EUR 29 price target. The analyst expects the company to deliver notable progress by 2025, marking a significant shift from its long-standing restructuring initiatives.
Deutsche Bank Aktiengesellschaft (NYSE: DB) also announced a strategic partnership with Ant International on June 5, aiming to provide expanded payment solutions to businesses of all sizes in Europe and Asia. The partnership aims to combine the expertise of the two companies, leveraging Ant International’s proprietary tokenization and AI-based FX technology and bringing a positive light to its operations.
Deutsche Bank Aktiengesellschaft (NYSE: DB) is a stock corporation company that provides investment services, corporate banking, private banking, and asset management. It operates through the Private Bank, Corporate Bank, Investment Bank, and Asset Management segments. Deutsche Bank Aktiengesellschaft (NYSE: DB) takes the seventh spot on our list of the top undervalued European stocks to invest in, with its headquarters located in Frankfurt, Germany.
6. Marex Group Plc (NASDAQ:MRX)
Forward P/E: 11.22
Number of Hedge Fund Holders: 22
Marex Group Plc (NASDAQ:MRX) is one of the 10 Undervalued European Stocks to Invest in Now. On June 9, Barclays analyst Benjamin Budish slashed Marex Group plc’s (NASDAQ:MRX) price target to $52 from $57, keeping an Overweight rating on the shares. Despite the drop in price target, the rating suggests the analyst’s optimism surrounding the stock and its potential to outperform its competitors.
Marex Group plc (NASDAQ:MRX) also announced plans to acquire Agrinvest Commodities, a Brazilian agricultural commodities business, on June 5. The acquisition is expected to expand the company’s operations in the Americas, adding in new clients and capabilities to diversify earnings and bringing optimism to its future operations.
The acquisition of Agrinvest Commodities will provide Marex Group plc (NASDAQ:MRX) with physical commodities capabilities in Brazil, along with its existing derivatives operations, augmenting the latter’s Brazilian business with around 1,300 clients and 100 employees.
Marex Group plc (NASDAQ:MRX) offers brokerage services for financials, commodities, and foreign exchange. The company is headquartered in London, United Kingdom, and ranks sixth on our list of the best undervalued European stocks to invest in now. It operates through the following segments: Clearing, Agency and Execution, Market Making, Hedging and Investment Solutions, and Corporate.
5. TotalEnergies SE (NYSE:TTE)
Forward P/E: 8.74
Number of Hedge Fund Holders: 25
TotalEnergies SE (NYSE:TTE) is one of the 10 Undervalued European Stocks to Invest in Now. In a report released on June 9, Biraj Borkhataria from RBC Capital maintained a Buy rating on TotalEnergies SE (NYSE:TTE) with a price target of €80.00.
The analyst’s optimistic outlook can be supported by the company’s fiscal Q1 2025 results, which showed a year-on-year production growth of nearly 4% in Oil & Gas and 18% in Electricity. This represents a unique TotalEnergies production growth of around 5%.
TotalEnergies SE’s (NYSE:TTE) adjusted net income for the quarter came up to $4.2 billion and FFO of $7 billion, with robust profitability and a return on capital employed for the 12 months ending in March at 13.2%.
The company is continuing its strong track record of attractive shareholder distribution, with buybacks worth $2 billion executed during fiscal Q1 2025. TotalEnergies SE (NYSE:TTE) also reported a 7.6% year-on-year growth in the first interim dividend of €25 to €0.85 per share, up 20% versus the pre-COVID level.
TotalEnergies SE (NYSE:TTE) operates as a global integrated energy company that produces natural gas and green gases, oil and biofuels, as well as renewables and electricity. It is headquartered in Courbevoie, France, and operates through the following business segments: Exploration & Production, Integrated LNG, Integrated Power, Refining & Chemicals, and Marketing & Services.
4. Novartis AG (NYSE:NVS)
Forward P/E: 13.41
Number of Hedge Fund Holders: 33
Novartis AG (NYSE:NVS) is one of the 10 Undervalued European Stocks to Invest in Now. Deutsche Bank analyst Emmanuel Papadakis maintained a Buy rating on Novartis AG (NYSE:NVS) on June 9, setting a price target of CHF115.00.
The company announced topline results from a pre-specified interim analysis of the Phase III PSMAddition trial on June 2, reporting that the trial met its primary endpoint. It demonstrated a clinically meaningful and statistically significant benefit for Pluvicto™ plus hormone therapy compared to hormone therapy alone, reflecting a positive trend in overall survival (OS).
Pluvicto™ already holds approval for metastatic castration-resistant prostate cancer (mCRPC) and has now begun to show potential in patients in an earlier disease setting. Novartis AG (NYSE:NVS) plans to submit for regulatory review in the second half of the year, depending upon FDA feedback.
Novartis AG (NYSE:NVS) holds the fourth spot on our list of the top undervalued European stocks to buy now. Headquartered in Basel, Switzerland, the company develops, markets, and manufactures a range of healthcare products. Its operations span the Innovative Medicines, Sandoz, and Corporate segments.
3. Rio Tinto Group (NYSE:RIO)
Forward P/E: 9.63
Number of Hedge Fund Holders: 36
Rio Tinto Group (NYSE:RIO) is one of the 10 Undervalued European Stocks to Invest in Now. In a report released on June 10, Richard Hatch from Berenberg Bank maintained a Buy rating on Rio Tinto Group (NYSE:RIO) with a price target of £62.00.
The analyst’s optimistic rating followed the company’s opening of its newest iron ore mine, Western Range, on June 6. The mine possesses the ability to produce up to 25 million tonnes of iron ore per year and could sustain the existing Paraburdoo mining hub for up to two decades.
Western Range is a $2 billion joint venture project between Rio Tinto Group (NYSE:RIO) (54 percent) and China Baowu Group (46 percent) that was completed on budget and on time.
Rio Tinto Group (NYSE:RIO) explores, mines, and processes mineral resources. The company is headquartered in London, United Kingdom, and ranks third on our list of the best undervalued European stocks to buy now. Its operations are divided into the Iron Ore, Aluminium, Copper, and Minerals segments.
2. Shell PLC (NYSE:SHEL)
Forward P/E: 11.28
Number of Hedge Fund Holders: 50
Shell PLC (NYSE:SHEL) is one of the 10 Undervalued European Stocks to Invest in Now. On June 9, RBC Capital analyst Biraj Borkhataria maintained a Buy rating on Shell PLC (NYSE:SHEL) and set a price target of £38.00.
The company’s fiscal Q1 2025 attracted positive investor sentiment with strong performance across the business, reporting adjusted earnings of $5.6 billion. CFFO, excluding working capital for the quarter, reached $11.9 billion while working capital outflow was $2.7 billion.
Shell PLC (NYSE:SHEL) also strengthened its optimization and LNG trading capabilities through the acquisition of Pavilion Energy and high-graded its portfolio by completing divestments of the Singapore Energy and Chemicals Park, and SPDC in Nigeria.
The company is commencing another share buyback program of $3.5 billion for three months, making fiscal Q1 2025 the 14th consecutive quarter of at least $3 billion in buybacks.
Headquartered in London, Shell plc (NYSE:SHEL) produces oil and natural gas. The company’s operations are divided into the following segments: Integrated Gas, Upstream, Marketing, Chemicals and Products, Renewables and Energy Solutions, and Corporate.
1. BP p.l.c. (NYSE:BP)
Forward P/E: 12.2
Number of Hedge Fund Holders: 51
BP p.l.c. (NYSE:BP) is one of the 10 Undervalued European Stocks to Invest in Now. In a report released on June 9, Biraj Borkhataria from RBC Capital maintained a Hold rating on BP p.l.c. (NYSE:BP) with a price target of £4.50.
The analyst adopted a cautious stance despite the company’s recent announcement on June 3 stating that it entered into a series of agreements to build and expand its major oil and gas interests in Azerbaijan.
BP p.l.c. (NYSE:BP) aims to support growth and additional production while also strengthening its partnership with the country and state oil company, SOCAR.
Headquartered in London, United Kingdom, BP p.l.c. (NYSE:BP) is an integrated oil and gas company that provides carbon products and services. Its operations are divided into the Gas and Low Carbon Energy, Oil Production and Operations, and Customers and Products segments.
While we acknowledge the potential of BP to grow, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and have limited downside risk. If you are looking for an AI stock that is more promising than BP and that has 100x upside potential, check out our report about this cheapest AI stock.
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Disclosure: None.
