Schneider Electric Not Getting Much Credit For Share Gains

Sometimes you have to love Wall Street logic. Grow slower than your peers? Well, you’re losing share, so that’s a “hold”. Outgrowing your peers? Well, looks like you’re at peak growth. Better go with a “hold”. Tongue-in-cheek cynicism aside, I do wonder what it will take for Schneider Electric (OTCPK:SBGSY) (SU.PA) to please the market, as this company not only posted one of the better organic growth rates for the quarter, it saw some operating leverage, and also raised guidance.

I understand concerns about a short-cycle slowdown, but the results and guidance posted by industrials so far this quarter suggest less risk of an imminent downturn, and Schneider is looking to boost prices in the second half of the year. With the shares down another 5% or so from my last write-up (when I thought the valuation was borderline), this is starting to slide into my “buy” zone, though I will admit the negative sentiment is a little bit of a concern in the near term.

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Schneider Electric Not Getting Much Credit For Share Gains