What Hexagon Holders Bought Into

Holding Hexagon from the start of the year would have returned 25.8%, including dividends. If you had put money to work on 1 January 2026, you would now be looking back at a period that included a sharp swing from a quarterly loss to a profit and a run of deal activity. Yet on that cold January morning, how clear was it that automation bets, software spin offs and acquisition appetite would all feel worth the risk?

On Simply Wall St, a Narrative is an investor's thesis written down: the reasoning, plus the numbers it rests on. Run those numbers and you get an estimated Fair Value.

The move put Hexagon in the middle of this trade. Scan 94 robotics and automation stocks for other companies exposed to it.

What Hexagon Investors Were Really Arguing About

The shares cost SEK108 at the start of the period, and Hexagon sat between two very different but plausible stories about how its automation push might play out.

In the bullish Narrative, the stock looked modestly undervalued, with a Fair Value of SEK115, or 6% above the start price. That view leaned on assumptions of 5.0% annual revenue growth, a 20.6% profit margin, and a future P/E of 287.8x over a 3 year horizon.

The bearish Narrative pointed to a Fair Value of SEK88.7, or 18% below the start price, and focused on risks. That case worried about rising regulatory scrutiny, deglobalization limiting automation demand, and heavier acquisition and R&D spending weighing on future earnings quality.

What The Results Changed For The Hexagon Debate

Hexagon’s swing from a €43 million loss in Q3 2025 to a €446 million profit in Q3 2026, with net margin moving from 4.4% to 42.5%, leaned toward the bullish narrative that assumed stronger profitability. The acquisitions of Waygate Technologies and Rocscience, plus the Octave spin off, gave the pro automation, higher margin story more real world backing. The cautious case was not removed, but the evidence shifted in favour of the optimistic view.

The key assumption here was whether Hexagon’s automation and software focus would show up in higher earnings. When you evaluate another stock, track the direction of net income and margin after major product launches or acquisitions and compare those figures with the profitability targets that the original thesis relied on.

What Hexagon’s Price Already Assumes After The Run

Hexagon now trades at SEK110, only slightly above the period’s SEK108 starting point despite a 25.8% total return from the start of the year. The selected Narrative’s Fair Value sits below the current price, reflecting concern that today’s valuation leans hard on execution.

Its argument hinges on high precision hardware exposure, rising tax costs and AEON robotics spending potentially squeezing margins over time. A buyer today is effectively assuming Hexagon can keep delivering on its earnings targets. That raises the question of how this aligns with the risk that mix shifts and higher Robotics investment compress group profitability.

"While Hexagon highlights the completed refocus on precision measurement, positioning and autonomy as a cleaner platform for growth, the shift towards a more hardware intensive mix with strong sensor sales keeps exposing gross margins to input cost, freight and FX volatility. This can constrain future EBIT margin progression even if revenue holds up."

That disagreement has a full argument behind it. → Uncover the lower Fair Value this Narrative argues for

How Could You Get There Earlier?

The story behind this run has already been told. The next one could be taking shape somewhere else. Where could you start looking before it becomes the headline?

• Company 1 - 15% below our estimate - supplies electrical buildouts for hyperscale data centers with a rapidly expanding backlog.
• Company 2 - 26% below our estimate - sells weight loss and diabetes injectables supported by strong demand for flagship treatments.
• Company 3 - 22% below our estimate - embeds AI tools into cloud, productivity, coding and security products for enterprises.

That is three of the list. See all 195 potentially undervalued companies →

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