Buy Signal on Alstom (ALO-FR)
Alstom is a € 17.6 Bn market and one of the world leading manufacturers of infrastructures for the rail transport sector. Revenue is derived from 4 segments :
1/ Rolling stocks (48%) including trains, tramways and locomotives;
2/ Signaling, information and control systems (18%)
3/Railway services (18%) including maintenance, modernization, management of spare parts, support and technical assistance services;
4/Railway infrastructures (16%) including infrastructures for the track laying, lines electrical power systems, electromechanical equipment, telecommunication devices and traveler information in station, terminals for automatic purchase of tickets, access to escalators, lifts for disabled, automatic landing doors on platforms, ventilation, air conditioning and lighting systems).
Alstom average revenue growth is c. 5% supported by megatrends such as urbanization and increasing traffic.
The company is expected to post a €15Bn revenue in 2022, including Bombardier coupled with a 6% operating margin that is expected to improve steadily towards the 8-10% zone. Alstom is looking to buy the Thales signaling division which is for sale, that could be a good fit for the company.
Short term catalyst : Thales Signaling Unit acquisition.
This signal looks consistent with the Major Bullish Trend in the European Industrial sector.