Research · Initiation · 7 October 2026
Schneider Electric Euronext Paris: SU
Schneider Electric is still selling the finished system. After the PTC sell-off, at €260.50 the price is close to fair.
The call No call
- Price at publication
- €260.50close, 6 October 2026
- Target
- Noneno position at this price
- Conviction
- Medium
What would prove the thesis wrongSchneider's organic revenue growth over the four quarters to September 2027 is below 4 per cent or above 11 per cent, the 2027 growth in my bear and bull cases; or its Systems share of revenue falls below 34 per cent for full year 2026 while Data Center and Networks sales grow double digit.
What would turn this into a callA price at or below about €242 or at or above about €371; or results that move my 2028 adjusted EPS with PTC to about €13.62 or more, which points long, or to about €8.88 or less, which points short.
Read the full notePDF, 5 pages: thesis, valuation, scenarios, risks and sources Open the modelExcel, live formulas: change an assumption and the target moves
The call in brief
- Schneider Electric makes the electrical and cooling equipment inside data centres. Its Systems business, which includes prefabricated power rooms, cooling and large UPS, has grown faster than its catalogue products and its software and services in each of the last five quarters, and grew 28 per cent organic in the second quarter of 2026.
- The claim is holding, but its own test is close. Systems was 34 per cent of revenue in 2025, the line my piece set, and by my arithmetic about 34.1 per cent in the first half of 2026.
- On 5 October Schneider agreed to buy PTC for US$22.6 billion in cash, funded with €5 billion to €6 billion of new shares and €16 billion to €17 billion of debt. The shares fell 14 per cent in two days, taking about €24 billion off the market value. On my numbers the deal trims 2028 adjusted EPS by 4 per cent, about €11 a share.
- My call is no call. Twenty-two times my 2028 adjusted EPS with PTC of €12.66 gives €278, 7 per cent above the price of €260.50, within a range of €191 to €341. Without PTC the base would be €290.