Legrand shares rise in Paris, buoyed by UBS’s optimism regarding data centre growth
The Swiss bank has upgraded its recommendation on the shares of the electrical infrastructure specialist. By 2027, the data centre business alone could generate a 14 per cent increase in revenue for the group as a whole
(Il Sole 24 Ore Radiocor) - Legrand is performing strongly on the Paris Stock Exchange, buoyed by comments and ratings from UBS analysts. The shares of the electrical infrastructure specialist were up 2 per cent at 132.30 euros at around midday, among the top performers on the CAC 40 index. UBS has upgraded its recommendation on Legrand from ‘Neutral’ to ‘Buy’ and raised its target price from €160 to €170. The Swiss bank believes that the market is underestimating the growth potential of the group, particularly in the data centre sector, where it expects continued strong momentum, alongside a gradual improvement in the other markets in which the group operates.
According to UBS, growth in the data centre sector remains undervalued. Whilst Legrand forecasts a 35–40 per cent increase in sales in this segment in 2026, following a rise of over 40 per cent in 2025, analysts believe this range could be exceeded and forecast that growth could accelerate further in 2027, driven by substantial investment in digital infrastructure. The data centre business alone could generate growth of around 14% for the entire Legrand group in 2027, and further potential could emerge if other markets recover or prices develop favourably. UBS analysts also highlight the quality of Legrand’s acquisition strategy, which they regard as a key differentiator from the competition, and estimate that acquisitions will contribute around 4 per cent annually to the group’s growth, supported by a consistently strong portfolio of opportunities and ongoing discipline in valuations. Against this backdrop, UBS has revised its forecast for adjusted operating profit for 2027 upwards by 15%, bringing it to around 7% above the consensus analyst estimates. Finally, the research firm considers the stock’s valuation to be attractive. Legrand is trading at 18.4 times expected earnings for 2027 and at 14.5 times EBITDA, multiples which lie at the lower end of historical ranges. The share is also trading at an average discount of around 8 per cent compared with its main European competitors, Schneider Electric and ABB.
