Siemens Energy: UBS initiates coverage as a buyer
(CercleFinance.com) - On Friday UBS initiated its coverage of Siemens Energy shares with a buy recommendation and a target price of 26 euros after the IPO of Siemens' energy subsidiary earlier this week.
In its report, the broker deplores the fact that the market is more focused on the company's high-efficiency gas turbine business, which now represent just 10% of its total sales - a share that is continuing to dwindle - rather than on the company's other businesses.
However, UBS points out that the fields of industrial applications, energy transmission, services and renewable energies are expected to grow by an average of around 2.7% between now and 2023, which should more than offset the decline in traditional businesses.
The broker also considers the stock is currently trading at an attractive valuation, with a cash flow yield of 8.9% and a dividend yield of 2.2%.
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The information and analyses distributed by Cercle Finance are only intended as decision-making support for investors. Cercle Finance's responsibility may not be entailed, either directly or indirectly following the use of such information and analyses by readers. Any non-professional investor is recommended to consult a professional advisor before making any investment decision. This indicative information in no way constitutes any invitation to sell or buy securities.
In its report, the broker deplores the fact that the market is more focused on the company's high-efficiency gas turbine business, which now represent just 10% of its total sales - a share that is continuing to dwindle - rather than on the company's other businesses.
However, UBS points out that the fields of industrial applications, energy transmission, services and renewable energies are expected to grow by an average of around 2.7% between now and 2023, which should more than offset the decline in traditional businesses.
The broker also considers the stock is currently trading at an attractive valuation, with a cash flow yield of 8.9% and a dividend yield of 2.2%.
Copyright (c) 2020 CercleFinance.com. All rights reserved.
The information and analyses distributed by Cercle Finance are only intended as decision-making support for investors. Cercle Finance's responsibility may not be entailed, either directly or indirectly following the use of such information and analyses by readers. Any non-professional investor is recommended to consult a professional advisor before making any investment decision. This indicative information in no way constitutes any invitation to sell or buy securities.