3 SIEMENS share price target reports by brokerages below. See what is analyst's view on SIEMENS share price forecast, rating, estimates, valuation and prediction behind the target. You may use these research report forecasts for long-term to medium term for your investment or trades in 2020.
While there are visible signs of slowdown in the near-term, we remain positive on SIEM from a long-term perspective as the company remains focused on 1) Digitization and localization 2) Creating smart infrastructure and 3) Increasing customers by leveraging its strong balance sheet and offering innovative financing. We have marginally cut our estimates for SY20E/21E to factor in higher than anticipated COVID-19 led business slowdown. The stock is currently trading at 36.1/29.9x SY21/22E earnings. We maintain BUY with revised TP of Rs1402 on 40x SY21E as we believe strong balance sheet will support the valuations.
We lower our FY21/22 EPS estimate by 8%, primarily on account of lower other income owing to C&S acquisition at INR21b. We do not factor in any earnings contribution from the acquisition yet, as we await finer details of financials of the acquired portfolio. We lower our Sep’21 target multiple on the stock to 36x (prior: 38x) owing to the overhang on the global growth outlook. We value the C&S Electric business at acquisition cost to arrive at a TP of INR1,520. Since our recent downgrade, the stock has corrected by 20% and now trades at FY21/22E P/E of 33x/29x. While valuations do provide cushion against downside, we maintain our Neutral rating owing to concerns about the capex cycle revival and the weak industrial growth outlook in the near term.
While there are visible signs of slowdown in the near-term, we remain positive on SIEM from a long-term positive as the company remains focused on 1) Digitization and localization 2) Creating smart infrastructure and 3) Increasing customer by leveraging its strong balance sheet and offering innovative financing. We have marginally cut our earnings estimates SY20/21E on the back of diminishing order backlog and lack of any large order visibility The stock is currently trading at 40/35.7x SY20/21E earnings. We maintain BUY with revised target price of Rs1676(Rs1687) on 40x SY21E as we believe strong balance sheet will support the valuations.
We haven’t incorporated the deal impact in our financial estimates yet as the exact product profile’s financials are unknown. Also, Siemens would require CCI approval for completion of the deal; it expects the deal to be completed by end-Dec’20. Moreover, Siemens stock has been an outperformer, rallying 57% over the past one year. It currently trades at FY20E/FY21E (September ending) P/E of 41x/36x, thus providing limited upside in the stock. We downgrade the stock to Neutral and await a better entry point in the stock.
Our EPS estimate increase by 17%/19% in FY20/FY21 mainly on account of lower tax rates. We roll forward our estimates to Sep’21E and value SIEM at 38x Sep’21E EPS to arrive at a TP of INR1,792/share (prior: INR1,290).
While there are visible signs of slowdown in the near-term, we remain positive on SIEM from a long-term positive as the company remain focused on 1) Digitization and localization 2) Creating smart infrastructure and 3) Increasing customer by leveraging its strong balance sheet (more than Rs50 bn of cash) and offering innovative financing. SIEM will continue to focus on Automation, Signaling and Electrification (Railways) in the Mobility division (10% of sales). We have cut our earnings estimates by 4%/5% for FY20/21E on the back of diminishing order backlog and lack of any large order visibility. We expect SIEM to deliver earnings CAGR of 20% over the next two years (FY19-21E). The stock is currently trading at 41/37x FY20/21E earnings. We maintain BUY with revised target price of Rs1687(Rs1722) on 40x FY21E as we believe strong balance sheet will support the valuations.
Robust segmental performance... Sales grew 9% YoY and 26% sequentially on the back of strong growth from segments Digital Factory(14% YoY), Mobility(63% YoY) and power distribution (22% YoY). Orders have been steady in 1HFY19 with ~13.7 growth YoY in overall (ex >Rs 1bn) order inflows with most orders coming from opex related upgradation Company's Vision 2020+ strategy has led to the reorganization of business verticals which is expected to enhance synergies. Uncertainties in the mobility, Gas & Power segments a overhang for investors We revise our rating to “Hold” with a target price of INR1,330 (35x Mar’21E EPS)
Valuations provide comfort: SIEM trades at FY19E/20E P/E of 34.5x/32.9x versus its long-term average trading multiple of 49x. The underperformance over the past one year can be ascribed to (a) MSCI exclusion, (b) the decision to sell-off the Mobility division to parent and (c) de-rating of the overall capital goods sector amidst election uncertainty. The current valuation provides comfort, given the scope of an improvement in the operating performance and the likely gradual recovery in capex spending. We upgrade SIEM to Buy with a target price of INR1,290 (35x Mar’21E EPS).
Digitalization key to growth, Capex recovery elusive. We expect SIEM to benefit from its strong focus on Digitalization/Automation opportunity due to very low penetration and industry’s drive to improve efficiency. We have raised FY19/FY20E EPS estimate by 2/3% mainly on account of strong 1HFY19 performance by Mobility and Power & Gas. We expect SIEM to deliver earnings CAGR of 15% over the next two years (FY18- 20E) and maintain Accumulate with revised target price of Rs1263.
Our management meeting with SIEM indicated the sustained thrust of the company to transform itself from being a product company (62-65% of sales) to a complete solution provider. SIEM is focused on 1) Digitization and localization 2) Creating smart infrastructure and 3) Increasing customer by leveraging its strong balance sheet and offering innovative financing. SIEM will continue to focus on Automation, Signaling and Electrification (Railways) in the Mobility division (10% of sales) post rejection of Siemens Alstom mobility merger by EU. Capex cycle is yet to show signs of any major revival, however demand for Digit solutions/ automation across segments (Auto, F&B, Cement, Oil & Gas, Sugar etc.) and cost control have enabled have Sales/PAT CAGR 4%/28% in last 4 years. We expect SIEM to deliver earnings CAGR of 14% over the next two years (FY18-20E). We arrive at target price of Rs1221 as we rollover target price to March21 EPS. We maintain Accumulate.
SOURCE: Data from D'Market via Quandl. Intraday data delayed 15 minutes.
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