Alstom: Goldman Sachs downgrades to 'sell

(CercleFinance.com) - On Tuesday, Goldman Sachs upgraded its rating on Alstom shares from 'neutral' to 'sell', with a price target nevertheless raised from 18 to 18.
5 euros.

In a note devoted to the European industrial sector, the analysts from the American investment bank express concern about a less buoyant environment in terms of order intake than currently anticipated by the market.

This observation leads them to post forecasts that are 8% and 17% respectively below those established by consensus for the 2025/2026 and 2026/2027 financial years.

Even if the Group were to achieve organic growth of more than 5% over the next three years and a FCF conversion rate of 100% in 2025/2026 - a target well above its historical performance and that of the sector as a whole - the New York-based firm says it sees no significant upside potential at current levels, given that the stock jumped by more than 90% last year.

In addition to a valuation deemed 'unattractive' compared with the rest of the sector, Goldman points out that Alstom is one of the few industrial groups not to offer redistributions to its shareholders, with a return on capital employed (ROIC) among the lowest in its sector.

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