Schneider Electric is a 185-year-old company. Is its stock worth investing in? Take a look at our article to find out.
The French group Schneider Electric continues to build on its 185-year history in the electricity and automation sector. With an annual turnover of more than twenty-five billion euros, Schneider Electric has become a world leader in electrical distribution, automation and industrial controls.
Schneider Electric was founded by the Schneider brothers (hence the name) in 1836. In the beginning, the company was called Schneider et Cie and specialized in steel, armament, shipbuilding and railway construction.
From 1892 to 1949, the company "Schneider et Cie" joined forces with other companies such as the Compagnie Générale de Traction, the Compagnie du Chemin de fer métropolitain de Paris (CMP) and the American subsidiary Westinghouse to enter the industrial electrical equipment sector. In 1949, Charles Schneider transformed the company into the holding company Schneider Group.
From 1949 to 1980, the group's activities were dispersed. In 1981, the Schneider SA group began to concentrate on the electrical industry. It then withdrew from all activities not related to this sector by selling the shares of the railway division to the company Alsthom.
The strategic acquisition of three major companies (Telemecanique, SquareD and Merlin Gerin) demonstrates the group's determination to establish its brand in the sector. With the sale of the building and public works company Spie Batignolles in 1996, the Schneider group completed the refocusing of its electrical activities.
In 1999, the company definitively changed its name to Schneider Electric to clearly and formally demonstrate its expertise in the electrical sector.
Today, Schneider Electric employs more than 140,000 employees through its subsidiaries in France, Australia, the United States, Spain, Canada, Denmark, Germany, and the United Kingdom. Schneider Electric's revenue, worth €25,159,000, decreased by 7.36% in 2020 compared to 2019. This has at the same time impacted the result, which decreased by 11.30%.
This situation is due to the slowdown of the world economy because of the economic crisis provoked by Covid-19. Despite this, the position of Schneider's shares on the stock market has been stable since January. It has even increased since last February.
Schneider Electric mainly sells its products to large companies and very little to the general public. The firm has a solid distribution network made up of intermediaries who have the skills and know-how to set up and implement highly technical offers. The main customers of the Schneider Electric group are electrical equipment distributors, painters, installers, system integrators, machine builders, energy companies and key accounts and privileged business partners.
Schneider Electric mainly targets five areas, including building, industry, residential, infrastructure and energy.
Schneider's main competitors include Alstom, Areva, Chint, Cyient, Danaher, Delixi, Eaton, Emerson, Fuji Electric, General Electric, ABB Group, Hager, Hitachi, Honeywell, Hubbell, Johnson Controls, Legrand, Mitsubishi, Moeller, Omron, Rockwell Automation, Siemens and Toshiba.
Schneider Electric shares are listed on the Paris stock exchange, with the CAC 40 as a benchmark. On March 29, the stock was trading at 126.30 euros, compared to 125.1 euros the day before, a slight increase of +0.96 points. Despite the 2020 crisis, the group's financial health is stable in general. Schneider Electric continues its consolidation activities, strategic investment in Uplight, and is even planning a capital increase for its employees.
Schneider Electric is a large company that invests in sustainability and innovation. In 2018, the company obtained the second place in the DJSI Dow Jones Sustainability Index rating.
In the electrical field, the company is an undisputed leader. It is very influential on the market and has a good reputation among users.
Throughout its history, Schneider Electric has invested in and acquired important companies and brands that have enabled it to position itself as a world leader in its field, including
Investing in Schneider Electric stock does not present any major drawbacks or risks at this time. However, there are some risks to consider, as the company operates in a field where technology is the center of its activities. Even if the group is the world leader in automation and controls, the tech field evolves very quickly.