We recently published a list of 10 Top Performing European Stocks Heading into 2025. In this article, we are going to take a look at where Codere Online Luxembourg, S.A. (NASDAQ:CDRO) stands against other top performing European stocks.
As per Deloitte, inflation in the Eurozone slightly rebounded in October but was still quite low. The consumer price index increased 2% in October as compared to the year earlier. While this was slightly up from the low of 1.7% of inflation in September, this was the lowest since June 2021. For the ECB, the increase to 2% should not be worrisome. This is because the ECB’s target is 2%.
As per the World Economic Forum, European households continue to save at their highest rates in years, with saving rates in the eurozone exceeding the pre-pandemic levels. In Q2 2024, the saving rate in Europe came in at 15.7%, reflecting an increase from the 15.2% rate that was seen in the quarter prior, as per Eurostat (the statistical office of the EU). In its latest economic forecast, the European Commission mentioned that GDP growth in 2024 is expected to be 1% in the European Union. Furthermore, the growth should improve to 1.6% in 2025.
Impact of Trump’s Presidency on Europe’s Economic Growth
As per Goldman Sachs, Europe might face a big hit to economic growth as trade tensions rise. These tensions are fueled by Trump’s proposal for sweeping tariffs on all of the US imports. The large bank added that the actual magnitude of tariff increases might be less of a matter of worry as compared to the uncertainty that is created by threatening to impose tariffs on Europe. While Mr. Trump’s 10% across-the-board tariff poses a clear risk, Goldman Sachs expects the incoming President to initiate a more moderate set of duties on European countries.
These tariffs will be targeted towards auto exports, which are worth $80 billion, or 0.9% of EU exports. The duties are expected to have a significant impact on GDP in Germany, Sweden, and Switzerland in particular. ECB president had earlier mentioned that, if Trump wins, it will be a threat to Europe due to his tariff ideas, NATO commitment, and climate change policies.
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Pathway For Rate Cuts and Inflation
The Bank of England decided to cut the interest rates by 25 basis points and mentioned that expected reductions would be gradual. This is because of the expectations that the British government’s first budget might lead to increased inflation and economic growth. As per Reuters, BoE mentioned that inflation is expected to rise to ~2.5% by the end of 2024 from 1.7% in September and 2.7% by 2025 end before declining gradually below its 2% target in mid-2027.
The Government’s decisions to raise a cap on bus fares, higher value-added tax on private school fees, and increase employers’ social security contributions are some of the measures that might fuel inflation.
Amidst the uncertainties about the Trump Administration’s policies, Wall Street analysts opine that investors are required to bet on stocks that have a proven track record and that are expected to grow in the near future.
A close-up of a roulette wheel spinning at an online casino.
Our Methodology
To list the 10 Top Performing European Stocks Heading into 2025, we used a screener and sifted through online rankings to extract the European stocks. After getting the initial list of 20-25 stocks, we filtered out the list by selecting the ones that have increased significantly on a YTD basis and which have higher upside potential, as of November 10. Finally, the stocks were ranked in ascending order of their average upside potential.
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 275% since May 2014, beating its benchmark by 150 percentage points (see more details here).
Codere Online Luxembourg, S.A. (NASDAQ:CDRO)
% Increase on a YTD Basis: ~145.9%
Average Upside Potential: ~34.4%
Codere Online Luxembourg, S.A. (NASDAQ:CDRO) continues to operate as an online casino gaming and sports betting company. The company is based in Luxembourg, Luxembourg.
Codere Online Luxembourg, S.A. (NASDAQ:CDRO)’s management is optimistic about the latter half of the year as a result of the investments in Mexico. Also, Argentina has been identified as a potential market for expansion because of its existing operations and synergies. Market experts believe that Codere Online Luxembourg, S.A. (NASDAQ:CDRO) has a strategic focus on the core markets of Mexico and Spain.
Codere Online Luxembourg, S.A. (NASDAQ:CDRO)’s recent expansion into the Province of Mendoza should further support growth momentum. Through this expansion, the company will be able to enhance its competitive position in the Latin American online gaming market.
Codere Online Luxembourg, S.A. (NASDAQ:CDRO) highlighted that improvement of payment integrations remains a key focus for enhancing customer experience and retention. The company is expected to capitalize on its strengths in the casino segment. Wall Street expects that Codere Online Luxembourg, S.A. (NASDAQ:CDRO)’s business in Mexico is expected to be aided by innovative partnership.
The company announced its groundbreaking collaboration with Blip, which is an AI-first conversational platform. The focus is to introduce an unparalleled gaming experience to Mexican customers. With the help of this collaboration, Codere Online Luxembourg, S.A. (NASDAQ:CDRO) expects to offer superior experiences for its customers in Mexico while, at the same time, improving the ability to deploy highly targeted promotional campaigns. The company’s marketing investments are expected to be focused on improving customer engagement and customer acquisitions, which should further aid Codere Online Luxembourg, S.A. (NASDAQ:CDRO)’s net gaming revenue over the upcoming quarters.
Overall, CDRO ranks 9th on our list of top performing European stocks heading into 2025. While we acknowledge the potential of CDRO as an investment, our conviction lies in the belief that some deeply undervalued AI stocks hold greater promise for delivering higher returns, and doing so within a shorter time frame. If you are looking for a deeply undervalued AI stock that is more promising than CDRO but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
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Disclosure: None. This article is originally published at Insider Monkey.
