LEGRAND : Oddo BHF confirms its recommendation on the stock
August 01, 2023 at 05:24 am EDT
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Oddo BHF confirms its neutral rating on Legrand shares, with an unchanged target price of 88 euros.
Yesterday morning, Legrand published H1 results slightly above expectations (5% in adjusted EBIT).
In Q2, Legrand surprised by low volumes but also by strong margins, according to the analysts. Organic sales growth in Q2 was only 2% (consensus 3.6%).
In H1, volumes were down 2.7%, while prices were up 7.3%. EBITA margin rose by 170 bp to 22.2%, supported by the wide gap between price increases and inflation in raw materials and components (+0.3% in H1 for the latter).
Our EPS for 2023 and 2024 are revised upwards by 1.6% on average. We include the latest acquisition (Teknica, 45 ME, Chile, UPS for datacenters). We now forecast organic sales growth of 3.3% (including -1.5% in volumes) and an adjusted EBIT margin of 20.1% for 2023', stresses the analyst.
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Legrand is the global specialist in electrical and digital building infrastructure. Its comprehensive range, suitable for the commercial, industrial, and residential segments of the low voltage market, makes Legrand a benchmark for customers worldwide. Close to its markets and focused on its customers, Legrand has commercial and industrial operations in over 90 countries. The group benefits from solid, long-term growth levers.
Geographically, 41.4% of net sales are generated Europe region, 38.6% in North and Central America and 20% in the rest of the world.
In terms of product offering, 36% of its sales come from products with enhanced value in use (datacenters, connected products in the Eliot program, and energy efficiency programs).
In addition, the group benefits from very solid social and technological megatrends which will support its long-term development.
LEGRAND 
