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Bonus Content from MarketBeat
3 Undervalued European Tech Stocks to Buy After the CeasefireSubmitted by Dan Schmidt. First Published: 4/23/2026. 
Key Points
- The April 8 Iran ceasefire triggered a 3.7% rally in the STOXX 600, with European tech surging more than 5% and signaling a potential sector recovery.
- SAP, Spotify, and Prosus each fell roughly 25% to 30% in 2026 but now show bullish technical signals, including positive RSI and MACD crossovers.
- All three companies trade below historical valuations despite solid fundamentals, and could be candidates to rebound as risk appetites grow.
- Special Report: The Biggest IPO Ever: Claim Your Stake Today
Markets are once again hungry for risk after news of an Iran ceasefire, and European tech looks particularly attractive. Many companies in the sector remain materially undervalued versus peers and historical averages, and emerging trends point to a tech revival in Europe. These three companies could be among the best ways to play the growing rally. Why European Tech Stocks Have More Room to RallyThe European STOXX 600 Index returned 17% in 2025, its best year since 2021, and entered 2026 with three tailwinds: falling interest rates, fiscal expansion after Germany relaxed its debt brake, and a rotation out of overvalued U.S. tech. But markets can turn quickly. European stocks plunged when bombs began falling in Iran, and a separate tariff scare pushed the STOXX 600 down nearly 12% in a month on fears of a widespread recession in several E.U. economies.
On the day the April 8 ceasefire was announced, the STOXX 600 posted its best one-day gain in more than four years, rising 3.7% by the close. Europe’s heavy exposure to Middle East energy made it unsurprising that European indices outpaced their U.S. counterparts. What was notable, however, was the outperformance of the European tech sector, which jumped more than 5% despite being relatively insulated from oil-price shocks. Tech’s outperformance not only signals a return of risk appetite but also suggests institutional investors may be re-entering the market. European tech lagged in early 2026, with several large-cap names bearing the brunt of selling. Now that tariff concerns and Iran-related risks are easing, investors appear to be bargain-hunting, and several major firms are trading well below their historical valuations. These stocks don’t just offer attractive valuations; technical tailwinds are forming too. When technical alarms quiet and bullish indicators appear, it often means institutions are positioning. Each of the three companies below has both fundamental and technical catalysts that could ignite their shares. SAP: Management Shows Confidence With Share Repurchase ProgramFew European tech names have been hit harder than SAP SE (NYSE: SAP) so far in 2026. The stock is down more than 25% year-to-date, returning to levels last seen in early 2024. The decline followed weaker guidance, as management reported moderating growth in the current cloud backlog during its Q4 2025 earnings release in January. That said, the total cloud backlog still exceeds €77 billion (about $87 billion), and gross margins remain near 75%, suggesting the sell-off was driven in part by geopolitical uncertainty as well as company-specific concerns. Management has signaled confidence by announcing a €10 billion (approx. $11.3 billion) share repurchase program over two years, which would represent roughly 10% of outstanding shares at current depressed levels. 
The April ceasefire helped SAP shares break out of their downtrend, and several technical indicators are turning positive. The Relative Strength Index (RSI) has moved above 50 into constructive territory, and the Moving Average Convergence Divergence (MACD) completed a bullish crossover even before the ceasefire news hit the tape. Spotify: Suppressed Valuation Despite Revenue Growth and Margin ExpansionSpotify Technology Inc. (NYSE: SPOT) also suffered earlier this year, falling nearly 30% in January even before the Iran conflict escalated. CEO Daniel Ek shifted into the role of executive chairman, and advertising revenue decelerated faster than expected in Q4 2025. Despite that, Spotify reported revenue up 13% year-over-year and gross margins of 33.1%—an increase of over 80 basis points. Monthly active users continue to grow, and management expects to exceed the roughly €2.9 billion (about $3.4 billion) of free cash flow generated in 2025. 
Despite improving revenue and margins, SPOT trades at the low end of its historical valuation range—about 33 times forward earnings. If management hits its Q1 2026 revenue growth target of roughly 15%, margin expansion could drive meaningful compounding. The stock has begun to break out: SPOT is using the 50-day simple moving average (SMA) as support, and the RSI shows strengthening upward momentum. Prosus NV: No Longer Buoyed by Tencent StakeProsus NV (OTCMKTS: PROSY) holds a meaningful stake in Chinese tech via a 23% position in Tencent Music Entertainment Group (NYSE: TME), acquired in 2021 for $14.6 billion. That exposure has historically provided an anchor to Prosus’s valuation—the current value of the Tencent stake exceeds Prosus’s market cap. With the stock trading at a deep discount to net asset value, new CEO Fabricio Bloisi has initiated buybacks to help close the gap. 
Prosus recently ended a steep downward trend. After falling nearly 30% year-to-date, the stock’s recent rally broke the long-term downtrend that had been in place since late 2025. Bullish MACD and RSI signals support the legitimacy of this breakout, so investors may want to monitor OTC stocks such as Prosus as potential recovery plays. |
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