Edenred: Durable Growth Obscured by Regulatory Uncertainty

Jean-Pascal Rolandez of The L.T. Funds presented his investment thesis on Edenred (France: EDEN) at European Investing Summit 2025.

Thesis summary:

Edenred is a world leader in specific use payment solutions. The company originated the restaurant voucher in France and operates on a commission-based model, charging both client issuers and merchant partners. After being spun off from Accor in 2010 , Edenred expanded to become the sector leader , operating in 45 countries with a network of over 1 million client issuers, 2 million merchant partners, and 60 million users. The company has diversified beyond vouchers into management services and controlled payments.

The investment thesis highlights a strong business model, a global network , and a management team described as very good, financially minded, and excellent at execution. The company has a strong post-Covid track record, showing +21% sales p.a. and +25% EBIT. While originating in France, the country now represents only 12% of OP. The business demonstrates high cash flow generation, with FCF estimated at approximately 30% of sales.

The opportunity exists because the company is viewed as a “fallen star” due to current regulatory uncertainty. This regulatory risk is present in all countries , with three main countries specifically under review. Other threats include potential new reforms, unfavorable litigation judgments, and fines from competition authorities. Weaknesses noted include high tax rates (31-32%) , exposure to Latin America (29% of EBIT) , and the presence of goodwill and negative equity.

The presentation suggested the valuation was attractive due to this regulatory overhang. It was noted that Capital group had taken a 10% stake, alongside seven other US investors holding 5%. Based on 2026 estimates, the shares recently traded at an EV/EBITDA of 4.1x. The thesis projects a durable high single-digit growth rate , and at the time of the presentation, the gross dividend yield was 5.8%.

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About the instructor:

Jean-Pascal Rolandez is the manager of The L.T. Funds, a Geneva-based investment firm focused on a buy and hold strategy based on a limited number of European stocks with a 5+ year investment horizon. Jean-Pascal has more than 25 years of equity investment experience and has founded the first investment club at the leading French business school ESSEC. Prior to establishing The L.T. Funds, Jean-Pascal held various executive positions at BNP Paribas for 22 years, including as Paribas’ French equity strategist.