Schneider Electric's Industrial Automation Bets Make Group Less Attractive
Dow Jones
Oct 06
0652 GMT - Schneider Electric's deals to buy PTC and Cognite change the investment case on the French engineering group to make it more reliant on its less attractive industrial-automation division, J.P. Morgan analysts say. JPM cuts its recommendation on Schneider to neutral from overweight, while trimming its price target to 310 euros from 345 euros. Schneider is spending big on its industrial automation division, with $27 billion allocated to the unit through the PTC and Cognite acquisitions, but this dilutes strong growth at its energy-management division that made the group an attractive investment, the analysts say in a research note. JPM says its preference in the industry shifts to Schneider's smaller French peer Legrand. Shares in Schneider closed 10% lower Monday at 272.80 euros.
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