ABB Ltd. (ABBN.S): Strong 2Q26 orders, to acquire Rotork

Research evidence excerpt

ABB Ltd. (ABBN.S): Strong 2Q26 orders, to acquire Rotork

Equity Research

16 July 2026 | 7:10AM BST

Daniela Costa

+44(20)7774-8354 |

daniela.costa@gs.com

Goldman Sachs International

Ines Lefranc

+44(20)7051-8710 |

ines.lefranc@gs.com

ABB consensus is likely to mechanically move upwards at least LSD on the back

of the 2Q26 orders and margin beat. Orders posted a strong 14% beat vs

company-compiled consensus, with 28% order growth sequentially accelerating and

driven by both Electrification Products (second quarter with triple digit Datacenter

growth) and Motion. Revenues were inline, but margins were 40bps ahead of

expectations, despite gross margins down on adverse price/cost (note pricing +2%).

FY26 guidance is raised for organic sales growth from ‘HSD to low DD’ to ‘low DD to

low teens (cons at 11%), while margin guide remains to be up yoy (cons +160bps

including 1Q26 RE gain), while 3Q OSG is guided low-to-mid teens (vs cons 11%) and

margin to be up sequentially (cons implies +10bps). FCF was also very strong beating

by 28%. We see this result as a positive read across for Electrical equipment

names, namely Schneider (Buy, on CL (last close €270.15)), Siemens (note comments

of sharp improvement in Machine Building also reading particularly well for DI) and

Legrand (with some comments on improvement in non-resi construction).

ABB has also announced its intention to acquire actuator company Rotork for

$5.5bn. The deal will add c.3% to group sales per the release. 2027 Visible Alpha

Consensus Data EV/Sales pre-synergies implied is c5x (vs ABB at 4.7x) and 21x

EV/EBIT (vs ABB 22x). Rotork has material exposure to O&G capex, an area where we

have seen a turn in our Capex Tracker (here). We note that the implied transaction