Re ABB - Siemens (SIEGY) trades at around a 13x earnings. This is basically the German version of GE, without the accounting shenanigans. They do own a huge power generation business that’s even a collapse in print, not unlike GE’s power business, but since the balance sheet is in good shape and he remaining business isn’t throng, there really isn’t much of a problem.
Just reading Paul’s post, I didn’t feel that the quarter was the weak. Power generation was weak, but that was expected. Book to Bill was 1.11x for the quarter which means that business seems to be picking up. I think the street didn’t like Siemens long term vision plan, more so than concerns about the quarter, IMO.
Siemens Sales growth appears low, because they have spun off so many parts over the years (Infineon many years ago, health care was floated for a rich valuation recently) and other were restructured in JV (transportation, car supplier business). Also to note is that. Lot of their business is more annuity like (software, service) The stock is a stalwart, so I wouldn’t expect outside returns, but the discount to US industrials seems too high now. |
