Paulo Bento's Portugal side were drawn in Group B of the UEFA showcase tournament, alongside Germany, Netherlands and Denmark.

Despite having to face two of the favourites for the title, Wenger believes individual ability may help the 2004 finalists impress in Poland and Ukraine.

"Portugal have the player in Cristiano Ronaldo, but also they have Nani - they have quality players," Wenger told Arsenal's official website.

"They can create a surprise. But because they haven't done well recently in tournaments, you don't have them as one of the favourites."

While praising Portugal, Wenger did acknowledge he considers Germany and the Netherlands better placed to progress from the group.

"You flip a coin and tell me who will come out of this group," he said.

"Holland are the second favourites (for the tournament) with Germany, after Spain. Holland and Germany would be the favourites to come out of the group.

"But because Holland have been in the World Cup final, and Germany have been in the World Cup semi-final, you can't rule them out of a European Championship. Those two should come out."