One concrete shift for Tieto in this period was its deepening AI partnership with Microsoft, aimed at integrating new tools into long standing client contracts rather than chasing one off projects. For Tieto shareholders, the return over the past year was 20.4%, including dividends. If you had been deciding on 16 October 2025 whether to buy, what would you have needed to believe about those AI efforts and cost cuts before the later earnings headlines arrived?
The easy part of this move is behind Tieto. Zero in on 195 high quality undervalued stocks for companies trading below our estimates.
The Argument You Would Have Been Weighing On TietoEVRY
The shares cost €16.24 at the start of the period, and you were effectively choosing between two stories about where TietoEVRY could go next.
The bullish narrative pointed to a Fair Value of €20, a notional price implied by its assumptions, built on the idea that cloud and AI services, together with at least €150 million of planned cost savings by 2026, could support higher margins and recurring revenue.
The bearish view put Fair Value at €12.3 and emphasized the risk that accelerating automation and public cloud adoption could erode traditional consulting income and pressure TietoEVRY's role in key Nordic markets.
What The TietoEVRY Evidence Actually Showed
The clearest new fact was TietoEVRY's Q2 2026 swing from a net loss of €61.2 million in Q2 2025 to net income of €84.7 million, lifting net margin from a decline of 13.2% to a positive 19.9%. That aligns with the profitability part of the bullish case, while the drop in revenue from €463.1 million to €426.6 million fits the more cautious growth story. Overall, the evidence cut both ways.
The main assumption to stress test elsewhere is that cost programs and AI partnerships can improve earnings without hurting client demand. A simple cross-check is whether revenue holds up while net margin and absolute profit move higher in the same reporting window.
What Tieto's Current Price Already Assumes
Tieto trades at €18.65, with this Narrative's Fair Value described as below that quote. The gap reflects concern that cost cuts and AI tools may be doing more for margins than for long term revenue health.
For today's level to stack up, a buyer would need confidence that higher margin software replaces shrinking consulting demand fast enough to keep earnings resilient.
"The main thing that has to go right is that Tieto Oyj converts its cost base reset and AI focused portfolio shift into sustainable growth in higher margin software and services, while Tech Consulting stabilises."
Not everyone reads the same price the same way. → See the lower figure this Narrative lands on, and how it gets there
Which Company Could Surprise You Next?
By the time a rally makes headlines, you are reading about returns someone else has already earned. Why not go straight to the source and look for your own contrarian opportunity? These three companies trade below our estimated value.
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Company 1 - 33% below our estimate - targets higher margin business hardware and software for hybrid collaboration.
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Company 2 - 34% below our estimate - grows fee income by arranging capital for renewable projects and structured products.
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Company 3 - 44% below our estimate - leans into new flagship stores and online channels to expand fashion demand.
Three companies from the same screener. Open all 203 companies with the balance sheet to back it up →
This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
Companies discussed in this article include TIETO.HE .
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