Key Takeaways:
- Global Powerhouse: Vinci (DG) is firing on all cylinders, with first-half revenue rising 3% driven by an 11% surge in Vinci Airports and solid growth in Energy Solutions.
- Price Projection: Our model projects the stock could climb to €161 per share by December 2027.
- Expected Returns: This target implies a compelling 15.9% annualized return, suggesting the market is undervaluing the company’s long-term growth potential.
- Energy Transition: The company is successfully pivoting to green energy, with its Cobra IS division securing massive renewable projects, including a 35-year PPP for electrical transmission in Australia.
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Vinci (DG), the French concession and construction giant, operates a highly diversified business model that provides resilience against economic cycles. In the first half of 2025, revenue reached nearly €35 billion, growing 3% despite a high comparison base.
While the construction segment saw a slight decline, this was more than offset by the booming concessions business. Traffic at Vinci Airports grew in 14 countries, boosting revenue by 11%.
However, the stock has faced headwinds from political uncertainty in France and a new corporate tax surcharge that hit net profit by €293 million.
With the stock trading at €121, these temporary tax issues may have created a buying opportunity for long-term investors.
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What the Model Says for DG Stock
We evaluated Vinci’s potential through 2027, factoring in the continued recovery of global travel and the structural growth of its energy division.
Our model signals a “Strong Buy.” Using a forecast of 3.1% Revenue Growth (CAGR) and 12.9% Operating Margins, the model projects the stock could reach €161 by the end of 2027.
This implies a 15.9% annualized return over the next two years.
This return profile is exceptional for a large-cap industrial stock, suggesting that the current valuation has become disconnected from the company’s earnings power.
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Our Valuation Assumptions
TIKR’s Valuation Model lets you plug in your own assumptions for a company’s revenue growth, operating margins, and P/E multiple, and calculates the stock’s expected returns.
Here’s what we used for DG stock:
1. Revenue Growth: 3.1%
Growth is broad-based but moderate.
Vinci Airports continues to be a standout performer, with double-digit growth in Japan, Mexico, and Budapest. The integration of Edinburgh Airport is also expected to contribute meaningfully in the second half of the year.
In Energy, the Cobra IS division is capitalizing on the green transition. They recently wrapped up funding for a major transmission project in Australia involving 240 kilometers of electrical lines.
We forecast consistent revenue growth of 3.1% CAGR through 2027, driven by price increases in toll roads (indexed to inflation) and volume growth in airports and energy.
2. Operating Margins: 12.9%
Vinci is structurally improving its margins as the high-margin Concessions business grows faster than the lower-margin Construction business.
Management noted that operating profit from ordinary activities (ROPA) rose 11.9% in H1, with margins expanding across most divisions. Vinci Airports alone saw margins improve significantly as traffic returned.
We project operating margins to expand to 12.9%, reflecting this favorable mix shift and ongoing operational efficiencies.
3. Exit P/E Multiple: 14.8x
Vinci currently trades at roughly 13.3x earnings, which is relatively low compared to its history and the quality of its assets.
Our model assumes an exit multiple of 14.8x by 2027.
We chose a multiple that represents a modest re-rating. As the market digests the one-off impact of the French tax hikes and refocuses on the company’s long-term infrastructure contracts, which offer inflation protection, we believe investors will be willing to pay a slightly higher premium.
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What Happens If Things Go Better or Worse?
Even in conservative scenarios, the stock looks resilient (these are estimates, not guaranteed returns):
- Low Case: If travel demand slows or taxes increase further, the stock could still deliver a 2.9% annual return (preserving capital).
- Mid Case (Longer Term): Looking out to 2029, even with conservative estimates, we project a solid 7.9% annual return.
- High Case: If energy projects accelerate and margins expand faster than expected, returns could reach 11.8% annual return over the longer 5-year horizon.
See what analysts forecast for the next 5 years for DG stock (Free with TIKR) >>>
How Much Upside Does Vinci Stock Have From Here?
With TIKR’s new Valuation Model tool, you can estimate a stock’s potential share price in under a minute.
All it takes is three simple inputs:
- Revenue Growth
- Operating Margins
- Exit P/E Multiple
If you’re not sure what to enter, TIKR automatically fills in each input using analysts’ consensus estimates, giving you a quick, reliable starting point.
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Disclaimer:
Please note that the articles on TIKR are not intended to serve as investment or financial advice from TIKR or our content team, nor are they recommendations to buy or sell any stocks. We create our content based on TIKR Terminal’s investment data and analysts’ estimates. Our analysis might not include recent company news or important updates. TIKR has no position in any stocks mentioned. Thank you for reading, and happy investing!
