LEGRAND (LR) AI Stock Analysis

• Market Cap: €38.61B
• Dividend Yield: 1.7%
• Average Volume (3M): 608.75K
• Price to Earnings (P/E): 31.8
• Beta (1Y): 0.96
• Revenue Growth: 10.57%
• EPS Growth: 13.41%
• Country: FR
• Employees: 33,959
• Sector: Industrials
• Sector Strength: 72
• Industry: Electrical Equipment & Parts
• EPS (TTM): 1.11
• Shares Outstanding: 262,245,730
• 10 Day Avg. Volume: 595,988
• 30 Day Avg. Volume: 608,755
• PEG Ratio: 7.62
• Price to Book (P/B): 3.27
• Price to Sales (P/S): 2.85
• P/FCF Ratio: 19.19
• Enterprise Value/Market Cap: N/A
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: N/A
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: €156.00
• Price Target Upside: 20.70% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 7
• EPS Forecast (FY): N/A
• Revenue Forecast (FY): N/A

• Rating: 63 Neutral
• Price Target: €138.00 ▲(6.77% Upside)

Legrand's overall stock score is primarily driven by its strong financial performance, characterized by consistent revenue growth and robust profitability margins. However, technical analysis indicates potential bearish momentum, and the high P/E ratio suggests overvaluation, which tempers the overall score.

Positive Factors

Revenue Growth

Consistent revenue growth indicates a robust market position and effective product demand, supporting long-term business expansion.

Profitability Margins

Strong profitability margins reflect operational efficiency and pricing power, enhancing the company's ability to reinvest and grow.

Innovation and R&D

Investment in R&D fosters innovation, ensuring competitive advantage and alignment with market trends in smart building technologies.

Negative Factors

Increasing Leverage

Rising debt levels may strain financial flexibility, potentially impacting the company's ability to invest in growth opportunities.

Decline in Free Cash Flow Growth

A decline in free cash flow growth could limit the company's capacity to fund new projects and return capital to shareholders.

Cost Pressures

Eroding gross margins may indicate rising input costs or competitive pricing pressures, which could affect profitability.

LEGRAND Business Overview & Revenue Model

Company Description

Legrand SA, together with its subsidiaries, provides electrical and digital building infrastructures worldwide. The company offers MCBs, RCDs, and din rail equipment, including residual current circuit breakers, RCBOs, add-on modules and accessories, surge protective devices, other control and signaling devices, and time and light-sensitive switches, as well as dimmers, relays, transformers, power supplies, and accessories; ACBs, MCCBs, head equipment, and busbar systems; enclosures and accessories; equipment and accessories; home network, home automation, and hotel equipment; wiring accessories; weatherproof wiring accessories and other installation equipment; lighting management, emergency lighting, access control, and safety equipment; UPS and LCS products, cable management systems, equipment, and accessories; and mosaic wiring accessories. Its products are used in hotels, offices, data centers, industrial sites, shops, hospitals, schools, and universities, as well as residential, commercial, and industrial buildings. Legrand SA was founded in 1865 and is headquartered in Limoges, France.

How the Company Makes Money

LEGRAND generates revenue through multiple streams, primarily by selling its extensive range of electrical and digital infrastructure products to distributors, wholesalers, and directly to end-users in various sectors. Key revenue streams include the sale of wiring devices, lighting management systems, and smart home solutions. The company benefits from a strong presence in emerging markets and strategic partnerships with construction and technology firms, which enable it to leverage new business opportunities. Additionally, LEGRAND invests in research and development to innovate and expand its product offerings, thereby driving sales growth and maintaining a competitive edge in the evolving market landscape.

LEGRAND Financial Statement Overview

Summary

Legrand exhibits strong financial performance with consistent revenue growth and robust profitability margins. The balance sheet is stable, though increasing leverage warrants attention. Cash flow generation is solid, but recent declines in free cash flow growth highlight potential challenges.

Income Statement

Legrand demonstrates strong financial performance with consistent revenue growth, achieving a 3.53% increase in TTM. The company maintains healthy profitability margins, with a gross profit margin of 51.28% and a net profit margin of 13.21%. EBIT and EBITDA margins are robust at 19.76% and 24.11%, respectively, indicating efficient operations. However, the slight decline in gross profit margin over the years suggests potential cost pressures.

Balance Sheet

Legrand's balance sheet reflects a stable financial position with a debt-to-equity ratio of 0.86, indicating moderate leverage. The return on equity is strong at 16.84%, showcasing effective use of equity to generate profits. The equity ratio stands at 42.17%, reflecting a solid equity base relative to total assets. However, the increase in total debt over the years could pose a risk if not managed carefully.

Cash Flow

The cash flow analysis reveals a mixed picture. While the operating cash flow to net income ratio is healthy at 0.56, indicating good cash generation relative to net income, the free cash flow growth rate has declined by 69.8% in TTM, which could impact future investments. The free cash flow to net income ratio remains strong at 0.85, suggesting efficient cash conversion.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	9.21B	8.65B	8.42B	8.34B	6.99B	6.10B
Gross Profit	4.72B	4.47B	4.40B	4.15B	3.56B	3.18B
EBITDA	2.22B	2.11B	2.04B	1.88B	1.66B	1.39B
Net Income	1.22B	1.17B	1.15B	999.50M	904.50M	681.20M
Balance Sheet
Total Assets	16.56B	16.07B	14.84B	14.42B	14.03B	12.91B
Cash, Cash Equivalents and Short-Term Investments	2.69B	2.08B	2.82B	2.40B	2.79B	2.79B
Total Debt	5.99B	5.09B	4.82B	4.67B	5.31B	5.39B
Total Liabilities	9.56B	8.53B	8.11B	7.77B	8.31B	8.00B
Stockholders Equity	6.98B	7.53B	6.72B	6.64B	5.72B	4.90B
Cash Flow
Free Cash Flow	1.32B	1.28B	1.58B	1.03B	942.20M	1.13B
Operating Cash Flow	1.55B	1.52B	1.84B	1.24B	1.11B	1.16B
Investing Cash Flow	-679.70M	-1.74B	-413.30M	-463.50M	-466.90M	-850.40M
Financing Cash Flow	-261.70M	-535.80M	-927.00M	-1.23B	-687.10M	823.70M

LEGRAND Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 129.25
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Positive
• MACD: Positive
• RSI: Positive
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For FR:LR, the sentiment is Negative. The current price of 129.25 is below the 20-day moving average (MA) of 146.01, below the 50-day MA of 141.44, and above the 200-day MA of 116.34, indicating a neutral trend. The MACD of 0.41 indicates Positive momentum. The RSI at 26.79 is Positive, neither overbought nor oversold. The STOCH value of 26.69 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for FR:LR.

LEGRAND Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
FGR	76 Outperform	€10.45B	10.47	14.39%	4.34%	7.71%	-2.82%
NEX	73 Outperform	€5.26B	11.00	25.83%	2.15%	12.65%	81.77%
RXL	67 Neutral	€8.66B	34.91	4.63%	4.04%	2.16%	-64.02%
SPIE	66 Neutral	€7.33B	36.10	10.66%	2.48%	10.87%	-10.35%
SGO	65 Neutral	€40.34B	14.40	11.84%	2.72%	1.09%	-0.94%
Sector *	63 Neutral	$10.79B	15.43	7.44%	2.01%	2.89%	-14.66%
LR	63 Neutral	€38.61B	31.80	17.67%	1.70%	10.57%	13.41%