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Investing.com - Morgan Stanley upgraded Schneider Electric SE (EPA:SU) (OTC:SBGSF) from Equalweight to Overweight on Monday, raising its price target to EUR280.00 from EUR240.00. The company, with a market capitalization of $169.6 billion, has demonstrated strong momentum with a 21.5% return over the past six months. According to InvestingPro data, Schneider maintains robust profitability with a 42.2% gross margin.
The upgrade places Schneider Electric among Morgan Stanley’s preferred Overweight names in the sector, alongside Siemens Energy (described as its "Top Pick"), Legrand, Rexel, and Sandvik.
Morgan Stanley’s higher price target reflects a sum-of-the-parts valuation rolled forward to 2027, which better captures Schneider’s potential operational improvements according to the firm.
The investment bank also increased target multiples in its valuation model to account for the recent re-rating of Schneider’s peer group.
Morgan Stanley has raised its earnings per share forecasts for Schneider Electric, lifting its 2026 EPS projection by 1.3% and its 2027 forecast by 1.5%.
In other recent news, Schneider Electric has received an upgrade from BofA Securities, moving from a Neutral to a Buy rating. This decision is accompanied by an increased price target from EUR231.00 to EUR265.00. The upgrade is attributed to Schneider Electric’s significant involvement in the data center sector, which accounts for 20% of its sales. Additionally, BofA Securities anticipates a recovery in the European construction market by 2026, further supporting the company’s growth prospects. These developments suggest a positive outlook for Schneider Electric as it continues to leverage its position in key growth areas.
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