Are These Italian Stocks Worth Buying?
The Milan Stock Exchange is offering an unusually diverse mix of stories today: defense companies with record orders, luxury goods with pricing power, regulated networks with high dividends, and energy companies that have benefited from geopolitics this year. However, third-quarter results showed that the best company and the best stock are not necessarily the same thing. What matters is the price you pay for growth, stability, or dividends.
Key points
Five well-known stocks on the Milan Stock Exchange offer entirely different opportunities. While some have gained more than 60% over the past year, one is trading near its yearly lows despite record order growth. Analysts nevertheless see almost 38% upside.
The Italian defense giant increased the value of new orders by nearly 28%, and its order backlog exceeded 60 billion euros for the first time. Yet its shares fell after the company released results that were better than expected. What concerned investors?
Ferrari is selling fewer cars than a year ago, yet it is increasing revenue, profits, and margins. Its operating margin is nearly 30%, exceptional for the automotive industry. The issue, however, may be the price investors are paying for this quality.
One of Europe's largest energy companies offers a dividend yield of more than 5%, and its profits increasingly depend on stable regulated networks. Standard screeners suggest that it pays out more than it earns. The reality, however, is considerably more favorable for investors.
One Italian oil company has increased its share price by more than 75% this year and plans to return approximately 8 billion euros to shareholders. Yet its shares are already trading above analysts' average target price. Are record profits sustainable, or is the market valuing only a temporary cyclical peak?
The Italian stock market is often viewed in Czechia mainly through the lens of banks, which have driven the FTSE MIB index higher in recent years. Beneath the surface, however, there is a group of industrial and energy companies that rank among Europe's best in their fields and are easily accessible to retail investors. They include a defense and aerospace conglomerate, a maker of luxury sports cars, one of Europe's largest utilities, an integrated oil company, and a global leader in steel pipes for the oil and gas industry.
These five stocks share Italian roots, but have almost nothing in common as investments. Each responds to a different macroeconomic driver: European defense spending, demand from the world's wealthiest customers, interest rates and network regulation, oil prices and refining margins, or drilling activity in North America. That is why it makes sense to examine the question "Are they worth buying?" separately and look not only at how the companies are performing, but above all at how much the market is currently asking investors to pay for their results.
All the companies have now reported third-quarter 2026 results, with the exception of the utility, which will release its results on November 12.