Alstom Shares Bounce Back Against the Trend of the CAC 40 After a 26% Drop in One Week
Alstom is up 2.61% in the session at €17.08, a technical rebound after a drop of over 26% over seven days. The rail group released preliminary annual results this Monday, showing a mix of a record order book and declining profitability. Following this, two analysts revised their price targets downwards.
Record Order Intake Amidst Profitability Concerns
This Monday, Alstom reported an unprecedented order intake of €27.6 billion for the fiscal year 2025/2026, marking a 39% increase. Despite reaching a historic level, this did not reassure as the adjusted operating margin stands at 6%, one point below the initial target of 7%. The group cites slower than expected progress on some major rolling stock projects. More worryingly, Alstom has revised its medium-term profitability ambitions downward, a signal that has weighed on the stock's valuation for several sessions. The full publication of the annual results is scheduled for May 13th. Rothschild & Co Redburn lowered its price target from €30.00 to €28.00 while maintaining a 'buy' recommendation. Oddo BHF made a more significant revision, reducing its target from €30.00 to €25.00 with an 'outperform' rating. Even after these adjustments, both targets remain significantly higher than the current price of €17.08, implying a revaluation potential between 46% and 64% according to these two brokers.
A 2.61% Rebound Amidst a Sharp Decline
The 2.61% rebound observed this Monday morning comes after a sharp decline: the stock has lost more than 36% in three months and is now far from its 50-day moving average, which stands at €25.59. The RSI, at 24, signals a pronounced oversold zone, a rarely reached level that reflects the magnitude of the recent correction. The price, at €17.08, is also below the lower Bollinger band (€19.81), confirming this extreme technical situation. The nearest support is at €16.64, the closing level last Friday. The market context does not make it easy for the stock. The CAC 40 is down 1.11% in the session, at 8,331.56 points, as is the SBF 120, which loses 1.06%. In the European industrial sector, Schneider Electric is down 1.61% and Airbus 1.91%. Alstom's rebound this morning thus goes against the Parisian trend, in a context where the DAX is up 2.27% in the session, offering a contrasting European picture.
