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Investing.com - Bernstein downgraded Siemens AG (ETR:SIE) (OTC:SIEGY) from Outperform to Market Perform on Tuesday, setting a price target of EUR230.00.
The downgrade comes as Siemens has eliminated its traditional conglomerate discount, which had persisted at around 30% since 2021 and reached a peak of 40% in Q2 2024 compared to peers Schneider and ABB.
Bernstein notes that Siemens has been rewarded by investors for its datacenter electrical exposure, portfolio rotations including software acquisitions of Altair and Dotmatix, the Innomotics sale, and plans to reduce its Healthineers stake to a minority holding by year-end.
Excluding Healthineers, Siemens is now trading on par with the average of Schneider and ABB at approximately 15x earnings, and at a 13% premium specifically to Schneider.
Bernstein’s sum-of-the-parts analysis concludes that Siemens’ fair value excluding Healthineers is around 13x earnings, indicating that for the first time in the past decade, Siemens trades at an 18% conglomerate premium, suggesting the stock is overvalued.
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