A Hungarian Stock That Even Beats the S&P 500

There is little talk of a Hungarian stock that has consistently beaten even the US stock market over the past 10 years. It is the US dollar-denominated share of Állami Nyomda (ANY Security Printing Company), an expert from Concorde Értékpapír Plc. writes on the financial portal portfolio.hu.

Perhaps the most stable company on the Hungarian stock market is undeservedly little talked about in the press, even though the performance of the management and the share, adjusted for dividends, is to be applauded. ANY Security Printing Company has provided its investors with an average return of over 20% over the past 10 years, and its performance over the entire time horizon exceeds 520%. By comparison, over this period, the S&P 500 index has returned an average of 17.7% in HUF terms, OTP 14.6% and the BUX index 11.6%.

ANY Security Printing Company may be familiar to many because it produces Hungarian passports and identity cards on behalf of government agencies. But the company's profile does not stop there. Few people would think it, but the company is present in most EU countries and even in more than 10 African countries, and its competitiveness has been improving over the years. With exceptional technological know-how and an advanced R&D center, ANY Security Printing Company is able to penetrate more and more markets.

In addition, whereas it used to be able to compete mainly in consortia with European companies, it is now able to carry out large-scale projects on its own. A good example of this is the 10-year contract announced last year with Angola for a EUR 130 million deal to build a passport system. The upturn seen in the first half of this year is particularly noteworthy. In this period, the company managed to generate more profit than in a full year in the years preceding the new coronavirus epidemic.

Although it has already managed to reach this level in the first half of 2022, unlike last year, the trend could be very different in the second half of the year. The export share has swelled to unprecedented levels and could be above 50% in 2023, up from around 40% previously. The start-up of the Angola project will kick the door down for investors in a good way, and the extra net profit from the project will be 100%, as is customary.