(BFM Stock Exchange) – The Canadian Bank has noted its opinion on the specialist in electrical equipment and energy efficiency technologies, deeming its recovery attractive. In addition, the data dissected by the Canadian establishment show a dynamic always vigorous in the data centers.

Definitely, the recent stock market correction suffered by Schneider Electric since the end of January inspires design offices.

After Goldman Sachs last week, Royal Bank of Canada noted his advice on Schneider Electric, to “outperformance” against “underperformance” previously, which amounts to “sell” to “buy” on the value. The Canadian Bank has also enhanced its course goal at 270 euros against 225 euros previously. This grants a potential of 17% to the title, during Tuesday closing.

On the Paris Stock Exchange, this change of opinion bears Schneider Electric which earns 1.5% around 11 a.m. and signs the highest increase in a CAC 40 in slight increase (+0.31%).

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A stock market hole

Author of an excellent stock market course these recent years, Schneider Electric experienced a fairly violent stop from the end of January. This dropout was superimposed on the fears of the market on the promises of artificial intelligence (AI) and on the expenses of “American Big Techs” in this area, and more specifically in data centers.

Schneider designs a range of electrical equipment and software that optimizes the energy efficiency of data centers, very energy -consuming installations. With the development of the AI, the group’s revenues in this segment have jumped and currently represent around 25% of the company’s total turnover. The good dynamics of data centers allowed Schneider Electric to display growth in comparable data of 12.5% ​​in the fourth quarter 2024 and to atomize expectations housed at 7.8%.

But the prowess of the Chinese start-up Deepseek threw a shadow. This company has developed major AI language models with performances competing with those of large American groups and a priori much lower costs. This led investors to question the heavy investment expenses envisaged by the American giants in the AI ​​and the data centers (we speak of around 80 billion dollars for Microsoft in the current financial year).

De facto, doubts about Schneider’s growth prospects were issued by investors. And the action suffered, losing 13% in just under two months. A sign of these concerns, Schneider unscrewed almost 7% on February 24, after TD Cowen reported that Microsoft had canceled major data centers rental in the United States.

An attractive valuation

For Royal Bank of Canada, this stock market hole that Schneider Electric knows is an entry point. The Canadian Bank believes that the action has returned to attractive levels. During the current course, Schneider Electric displays a multiplies of corporate value reported to the adjusted operating profit expected in 2025 from 17, less than the average of its peers (Siemens, the Swiss group ABB), located at 18. Royal Bank of Canada estimates that Schneider Electric deserves to be treated with a multiple closer to 20, that of the American Eaton, also very exposed via its electrical equipment.

The Canadian establishment recalls that Schneider has more pronounced growth than that of its rivals, on average. Over the past five years, the French group has had an average increase in its income of 7.4% against an average of 5.4% for its competitors.

This outperformance is particularly notable in the “Energy management” division, which has experienced an average annual growth of 9.3% in comparable data, in the past five years, a difference of 1 percentage point compared to Eaton, its nearest rival, and 2 points compared to the electrification divisions of Siemens and ABB.

Royal Bank of Canada thinks that Schneider Electric will continue to outdo competition, tabling on growth of 7.7% per year on an average of 2025-2026 against 5.7% for its European rivals.

By taking into account only electrification activities, the bank expects growth of 8.2% per year for Schneider, which would ahead of all its competitors on this performance indicator except Eaton (+8.8%).

Royal Bank of Canada also believes that the perspectives in the data centers continue to be flourishing for Schneider, despite fears of the market.

“Despite recent concerns about a larger bubble, the fundamentals of demand continue to improve and remain a key attraction,” says the bank.

The establishment anticipates annual growth in this segment of at least 15% per year over the next five. Royal Bank of Canada notes that Eaton, who had held a day dedicated to investors last week, had assured that he did not notice any “slowdown” in the investment projects of his customers in the data centers.

“Schneider is well placed to respond to investments in data centers, with significant market share and products adapted to electrical segments of gray and white spaces,” concludes the bank.