Shares of Nordea Bank , the Finnish lender, have been labeled “too cheap to ignore” by investment bank Berenberg. Nordea , founded in 1820 and headquartered in Helsinki, has millions of customers throughout Finland, Sweden, Norway, and Denmark. The stock is also traded in the U.S., U.K. , Germany , Italy and Switzerland . Earlier this week, the bank reported first-half results, with net profit rising to 2.66 billion euros ($2.89 billion), up from 2.48 billion euros in the previous year. Net interest income – earned through the differences in rates offered to savers and borrowers — grew 7% year-on-year to 3.86 billion euros. These robust figures come despite ongoing macroeconomic uncertainties and a challenging geopolitical climate, according to the bank. “Our results show that despite the slow economy, we continue to make good progress on our strategic priorities and deliver industry-leading financial performance,” said Frank Vang-Jensen, chief executive of Nordea. According to Berenberg’s analyst, the strong fundamentals make Nordea an attractive investment opportunity with 27% upside potential. “Nordea’s attractive fundamental characteristics become even more compelling as its price-to-earnings premium to the sector narrows, in our view,” said Hugh Moorhead in a note to clients on July 16. Moorhead maintains a “buy” rating on Nordea, but lowered its price target slightly to 156 Swedish kronor ($14.67) from 157 kronor. “Trading on only 7.5x our [financial year] 2025 earnings — an 8% premium to the sector — we think Nordea is too cheap to ignore. Buy,” Moorhead added. NRDBY 5Y line As central banks in three of Nordea’s four home markets have begun cutting interest rates, with further reductions anticipated, the stock has underperformed in 2024, falling by 2%. Banks typically make less money in a lower interest rate environment. However, the Berenberg analyst believes that Nordea’s net interest income is relatively resilient, noting that “the market still underappreciates Nordea’s [net interest income] stability, in our view, which contrasts favourably to that of more rate-sensitive Nordic peers.” The analyst also said that recent challenges, including a slight miss on second-quarter net interest income expectations or a modest cost increase, should not deter investors. In addition, Moorhead holds a positive view on Nordea’s long-term shareholder distributions despite the bank’s plan to delay share buybacks until 2025. The analyst projects 11% to 12% annual total yield, beating the sector average. The stock also trades with a 9% forward dividend yield.