REAL-TIME GLOBAL RESEARCH
JPM | Industrial Strength Morning Messages: Regime Change?
Key takeaways
- JPM | Industrial Strength Morning Messages: Regime Change?
- Torrid day in markets yesterday but a firmer lead this morning with the US recovering on the back of Jensen Huang comments re Coreweave and the Warsh comments re rates.
- I’d also highlight that we often see Fridays trade in reverse of the current prevailing trend with many investors looking to reduce risk intot he weekend given high levels of geopolitical uncertainty.
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Research evidence excerpt
JPM | Industrial Strength Morning Messages: Regime Change?
Good Morning. Torrid day in markets yesterday but a firmer lead this morning with the US recovering on the back of Jensen Huang comments re Coreweave and the Warsh comments re rates. I’d also highlight that we often see Fridays trade in reverse of the current prevailing trend with many investors looking to reduce risk intot he weekend given high levels of geopolitical uncertainty. I don’t feel confident that the ructions we’ve seen this week have finished. The Jensen comments re Corweave, in particular, were reminiscent of the Trump peace comments whent he Iran conflict was in full swing. Sounded great - but no actual follow through. As Jerry Maguire would say ‘show me the money’. GS shares didn’t stabilise in 2008 until Warren bought stock and warrants.
SCHNEIDER ELECTRIC: Given the current concerns regarding Data Centres, Schneider’s Q3 revenue print is helpful. I put a preview out yesterday (HERE) highlightign that the buyside bar for group OSG was 16% - so the 16.9% reported is ‘good enough’. The Company has also upgraded its organic EBITA growth target for the year to 18-21% (from 14-19%). This consists of OSG 12-14% and the street is already at 13% while EBITA margins are expected to be +100-120bp - with consensus already largely there. Within the print, as well, we have North America EM OSG marginally light of consensus (but ahead of JPM) - but a much better than expected results in China (+32.4% OSG). Read-X to Siemens fromt he IA division is also slightly mixed. The division beat on OSG - with a much better (+16.3%) result in Nth America but a miss in Europe and in-line in China. Within China the Company called out better discrete automation and weaker process - which would be helpful to Siemens.
SCHNEIDER ELECTRIC Q3 REVENUES: SPEC FIRST TAKE: OSG 16.9%, BEATS JPM, CONSENSUS AND BUY-SIDE BAR. ALSO UPGRADES GUIDANCE - Organic EBITA growth now expected to be 18%-21% (was 14-19%).
Both divisions have beaten on OSG with EM +19% (cons 15.1%) and IA +8% (cons 7.7%). Regionally China outgrew Nth
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