Spanish stocks: Amadeus and Aena ahead of Inditex

2026-10-23 · By Lubin Danilo, founder of Lubin Investment

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In Spain, Amadeus (10 of 10), Aena (8 of 10) and Ferrovial (7 of 10) stand out. Aena and Ferrovial trade narrowly below my buying threshold, while Amadeus's threshold is 37% under its price and Inditex's 66%. The utilities Iberdrola and Endesa meet only 4 criteria out of 10. Banks fit my pricing method poorly.

Ask a French investor about Spanish stocks and he answers Inditex, the parent of Zara, then Santander. Madrid is a market people know through two logos and a utility. Yet it is one of the most surprising markets in Europe: a travel booking system, an airport operator and a toll road builder sit next to heavily indebted electricity groups.

I ran eleven Madrid stocks through my grid. It first judges a company's quality (margins, growth, cash generated, debt, share count) on 10 criteria, separately from the price. Then it compares the share price with the free cash flow produced, meaning the money left once investments are paid, to estimate a reasonable buying threshold. Here is the result.

Which Spanish company passes the quality test best?

Amadeus, by a wide margin: 10 criteria out of 10. It runs the reservation systems of travel agencies and airlines. Each time a ticket is booked through the system, it collects a small fee, which creates a steady revenue stream that does not depend on the weather or on jet fuel prices.

The numbers are those of a well oiled machine: 21.3% of sales end up as free cash flow, return on invested capital is above 37%, and the share count falls by about 1.6% a year thanks to buybacks. Free cash flow per share grows about 18% a year over five years. One reading trap: the 25% yearly sales growth over the period starts from a trough, the health crisis, and will not repeat.

Is Amadeus too expensive after the Middle East shock?

On July 31, 2026, Amadeus published a calmer first half: sales of €3.33bn, up 5.1% at constant exchange rates, free cash flow of €472m (+0.8%), and a €500m buyback completed in June. The group blames the slowdown on the Middle East conflict: global air traffic fell in April and May, a first in fifteen years outside Covid. It saw early signs of recovery in July but warns its targets may not hold if the situation worsens.

On price, the stock is valued at 17.5 times its free cash flow. My deliberately cautious model puts my buying threshold at €34.6, which is 37% below the €54.8 share price. The market is already paying for the recovery. I have no usable valuation history to compare this multiple with its own past, so I do not claim the stock is expensive against itself, only above what my method accepts. I covered its business model in my Amadeus analysis.

Aena: can an airport be a good investment?

Yes, when it is run like Aena, which operates almost all Spanish airports. The mechanism is simple: airlines pay fees for each passenger and each landing, and shops and car parks add to it. Tariffs are set by a regulator over several years, so visibility is high but room to maneuver is limited.

In the first half of 2026, Aena earned €1,002m (+12.1%) on revenue of €3.30bn (+10.1%), with a 54.5% EBITDA margin and 190 million passengers (+3.9%). Part of this rise comes from a temporary shift of travelers toward Spain, seen as a safe destination: the company itself does not treat it as lasting, and expects about 3% more traffic for the year.

My grid gives 8 criteria out of 10. 27.5% of sales become free cash flow and it grows about 23% a year over five years. Net debt is about three years of free cash flow, comfortable for an infrastructure operator. The one real reservation: revenue per employee grows more slowly than my threshold. On price, the stock is valued at 22.8 times its free cash flow and sits about 3% below my buying threshold: fair, not cheap.

Ferrovial: how can profit halve without being a problem?

On July 28, Ferrovial reported net profit of €258m, down 52%. An alarming headline, but the reason is accounting: the first half of 2025 included large gains from asset sales. Without that effect, adjusted EBITDA rose 14% to €746m and the construction order book reached €18bn.

Ferrovial runs toll roads (including the 407 ETR near Toronto) and airport stakes, then builds infrastructure. In my grid it gets 7 criteria out of 10. Free cash flow per share grows about 21% a year and the margin reaches 18%, but revenue per employee falls, which reflects the weight of construction, a labor heavy trade. It is valued at 19.2 times its free cash flow, about 3% below my buying threshold.

Is Inditex worth its premium price?

Inditex is a very fine company: 8 criteria out of 10, a 31% return on capital, and €10.4bn of net cash at the first half of its fiscal year, which ended in late July. Sales there reached €19.76bn (+7.6%, +9.2% excluding currency effects) and profit €2.98bn (+6.8%). It is also closing stores: 5,444 outlets against 5,528 a year earlier, in favor of larger sites and digital.

Its problem is the price. The stock is valued at 26.4 times its free cash flow and my buying threshold, at €18.6, is 66% below the €55.2 share price. The threshold is harsh because my model assumes free cash flow per share, high today, drifts back toward its average of recent years. That is debatable for a brand that stretches good years, but the method is the same for every company. Free cash flow growth, about 6% a year, is also below my 10% bar.

Why do utilities disappoint despite rising profits?

On July 22, Iberdrola announced net profit up 22% to €4.34bn. But a gain of about €953m on the sale of its Mexican business explains much of the rise, and adjusted profit grows only 7.8%. Above all, investment jumped 25% to about €7bn over the half and adjusted net debt reaches €54bn.

That is the mechanics of utilities: they build grids and plants, spend almost all their cash on these projects, and shareholders wait years to see the return. Result in my grid: 4 criteria out of 10 for Iberdrola and for Endesa. Iberdrola's free cash flow per share falls about 5% a year and the stock is valued at 44 times its free cash flow. Cellnex, which rents telecom towers, gets 5 criteria out of 10 with debt equal to nearly 39 years of free cash flow. That does not mean these companies are badly run, only that they do not tick what I look for.

What about the banks, Santander and BBVA?

Santander gets 6 criteria out of 10 and BBVA 7. They look attractive, BBVA being valued at under 10 times its free cash flow. But for a bank, customer deposits sit on the balance sheet as debt, and free cash flow is blurred by loan movements. My buying threshold is therefore not usable for them, and I do not quote it. I explained this limit in my article on bank valuation.

What does the table show?

The reading is blunt: Spanish quality sits in toll and subscription style services, not in energy. Aena and Ferrovial are today the only two of the eleven stocks combining a solid score and a price below my buying threshold, narrowly. Amadeus is the finest company but awaits a better entry point.

How do I sum up Spain?

To me, Madrid is a market where the best known name, Inditex, is not the best bet, and where utilities, widely held in French portfolios, are the ones that fare worst in the test. To dig deeper, the Amadeus page and the one for Aena detail each criterion, and my full methodology explains how scores are built. That is what I wanted to be able to do for any stock market, and why I built my site. To place Spain against the rest of the continent, read my study on Europe too.

FAQ

What is the best Spanish stock according to your method?

Amadeus scores highest, with 10 criteria out of 10. But its price is above my buying threshold. Aena and Ferrovial currently sit just under theirs, with 8 and 7 criteria out of 10.

Why is Inditex not on top?

Because its quality is high (8 of 10) but so is its price: the share price is far above my buying threshold, which is built cautiously.

Are Spanish stocks eligible for the French PEA account?

A company listed in Madrid with its head office in the European Economic Area is in principle eligible, but always check with your broker: each case depends on the issuer's head office.

Related reading

• When to Sell a Stock: Three Signals, One Trap
• European quality stocks: which ones are actually cheap?
• French quality stocks: why the prices differ so much

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About the author

Written by Lubin Danilo, founder of Lubin Investment. A self-taught individual investor, I find fundamental analysis fascinating, and it has delivered excellent results. For three years now, my performance has beaten the S&P 500. But analyzing every stock took too much time: sites with incomplete data, calculation methods and criteria never aligned with mine. And spotting the best stocks was just as time-consuming, even with my own well-defined checklist. So I put my software development background to work to build this software, base my investment strategy on its results, and share it with people who share the same passion as me. It judges a company's quality and its price separately, using criteria drawn from the financial literature (Warren Buffett, Michael Mauboussin, Aswath Damodaran).