Capital Goods: Re-rating could follow positive consensus EPS revisions

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Capital Goods: Re-rating could follow positive consensus EPS revisions

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Capital Goods

Re-rating could follow positive consensus

EPS revisions

Industry Overview

Sector multiple flat YTD despite strong +ve EPS revisions 22 June 2026

Share prices across our coverage are up c. 6% YTD after the first (almost) six months of Equity

the year. However, 12m EPS revisions were also c. +6% YTD on average which indicates Pan-Europe

the sector multiple has not changed. We nevertheless think that the sector could benefit Capital Goods

from re-rating as the year progresses, given its strong earnings momentum. We believe Benjamin Heelan >>

this is particularly interesting in two sub-segments: (i) Power, which has de-rated almost Research Analyst

20% YTD despite having the strongest earnings revisions (we prefer Siemens Energy, Merrill+44 20Lynch7996 (DIFC)5723

Wartsila in this bucket) and (ii) Mining equipment which has de-rated 1% YTD despite benjamin.heelan@bofa.com

the second strongest earnings revisions (we prefer Epiroc, FLS and Weir). Electricals Alexander Jones, CFA >>

Research Analyst

have seen the strongest YTD re-rating (+17% on avg) of any sub-sector, led by Prysmian, MLI (UK)

but we believe this is justified by strong EPS revisions (+8%) with further upside ahead. +44 20 7995 5828

alexander.jones2@bofa.com

Power & Mining = strongest revisions (but have de-rated) UmaResearchSamlinAnalyst>>

Earnings revisions have been strongest for the Power sub-sector (12m fwd/2026 EPS MLI (UK)

+44 20 7995 1964

+39/25% YTD) driven by standout prints & strong earnings growth from both Siemens uma.samlin@bofa.com

Energy (see Plenty of gas in the tank) and Nordex. We expect this strength to continue Aron Ceccarelli >>