Morgan Stanley names Legrand LEGD.PA its new "top pick" as the stock's recent underperformance vs peers does not reflect its earnings growth potential.
Shares in the French electrical equipment maker rise 2.6% to €139.95 in Paris morning trade.
The broker says Legrand has de-rated by roughly 20% vs electrification peers, like ABB ABBN.S or Schneider Electric SCHN.PA, despite similar earnings upgrades.
MS ups its PT by 3.2% to €160.
Citing upside to 2027 growth estimates from strong data centre demand and limited risk of order-related disappointment, MS sees Legrand as "the best of both worlds".
MS forecasts 2027 EBITA 6% above consensus and sees additional upside from North America margin expansion and a recovery in Europe.
Out of 21 analysts, 13 rate Legrand "strong buy" or "buy", six "hold" and two "strong sell" or "sell" - LSEG data.
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