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On Thursday, Deutsche Bank (ETR:DBKGn)’s analysts increased the price target for Legrand SA (EPA:LEGD) (LR:FP) (OTC: LGRDY) to €115.00, up from €112.00, while reaffirming a Buy rating on the stock. Currently trading at $22.87, the stock has delivered an impressive 18.44% return year-to-date. The adjustment follows Legrand’s first-quarter performance, where the company’s growth and margins exceeded expectations, and management expressed confidence in their ability to fully offset tariff costs.
The analysts highlighted Legrand’s valuation, noting that the stock is currently trading at 15 times enterprise value to earnings before interest, taxes, amortization (EV/EBITA), and 20 times price to earnings (P/E) based on their 2025 projections. According to InvestingPro data, the current P/E ratio stands at 23.1x, with the company maintaining impressive gross profit margins of 51.64%. This represents a 5% discount to the company’s historical multiples, which they consider attractive for an asset with long-term compounding potential. They also pointed out that this valuation comes in anticipation of a possible recovery in the European Union building market in 2026.
Deutsche Bank underscored the resilience and strong pricing power of Legrand, which they believe makes the stock appealing in the present market context. The company’s ability to surpass expectations with a 3% beat on EBIT in the first quarter was a key factor in the decision to raise the price target. InvestingPro analysis shows the company maintains a strong financial health score of 2.77 (GOOD), operating with moderate debt levels and liquid assets exceeding short-term obligations.
The report from Deutsche Bank suggests that Legrand’s solid performance and future market prospects make it a noteworthy stock for investors. The new price target reflects the analysts’ optimism about Legrand’s ability to maintain its growth trajectory and leverage its strong market position. InvestingPro data reveals the company has maintained dividend payments for 20 consecutive years, with a 13.73% dividend growth in the last twelve months. Subscribers can access 8 additional ProTips and comprehensive financial metrics to make more informed investment decisions.
In other recent news, RBC Capital Markets has upgraded Legrand SA’s stock rating from Underperform to Sector Perform, while also raising the price target to €113 from €87. This adjustment comes as RBC analysts perceive that the primary challenges faced by Legrand have started to diminish. The company has shown resilience with strong margins and cash conversion rates, factors that contributed to the improved rating. A notable development for Legrand is its increased focus on the datacenter market, which has grown rapidly. In 2024, sales from datacenters increased by 5 percentage points year-over-year, now making up 20% of Legrand’s total sales. RBC Capital Markets has expressed confidence in Legrand’s potential for stable financial performance, supported by the company’s strategic positioning in the datacenter sector. The new price target reflects a shift in expectations regarding Legrand’s market positioning and future growth prospects.
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