ABB Ltd.: Acquisition of Rotork for $5.5bn and very strong Q2 orders

Research evidence excerpt

ABB Ltd.: Acquisition of Rotork for $5.5bn and very strong Q2 orders

Deutsche Bank

Research

Rating Company Date

Hold ABB Ltd. 16 July 2026

Results

Europe

Switzerland

Reuters Bloomberg Exchange Ticker Price at 15 Jul 2026 (CHF) 83.18

ABBN.S ABBN SW SWX ABBN

Price Target (CHF) 70.00

Capital Goods

ADR ISIN 52-week range (CHF) 88.56 - 47.41

Electrical Equipment

ABB US0003752047

Acquisition of Rotork for $5.5bn and

Valuation & Risks very strong Q2 orders

Gael de-Bray, CFA

ABB announced the acquisition of Rotork, a leading manufacturer of electric

Research Analyst

actuators, for 503 pence in cash, representing a 60% premium to the latest 3- +33-1-4495-6562

month average share price. The EV paid of $5.5bn implies an EV/Sales of 5.3x and

EV/EBITDA of 19.5x based on 2025 actuals. The transaction will add 3% to ABB's Nabil Najeeb

revenues and will be slightly accretive to margins, but the high price means the

+44-20-754-17410

deal should only be (marginally) accretive to EPS in year 2 after integration.

Rotork's presence in instrumentation and mission-control flow control is John Kim

complementary to ABB's automation portfolio. The Board of Directors of Rotork Research Analyst

has unanimously approved the transaction, which is expected to be finalized in +44-20-754-18699

H1'27. ABB also published strong Q2 orders and, as expected, upgraded its FY26

Price/price relative

organic revenue growth guidance. The shares should do well today, but we retain

our HOLD rating on valuation grounds, with the stock trading at 21.5x EV/EBITA 100

and 29.3x P/E on our 2027 estimates.

Strong Q2 results 0

2024 2025 2026

ABB's Q2 orders rose by 28% organically, beating consensus by 14%, led by the

Electrification business area. Sales came in line, with 12% organic growth and a ABB Ltd. – (Rebased)