Alstom Shares Under Pressure Mid-Day Following Negative Review
On Tuesday, January 27, Alstom shares dropped by 4.25%, trading at 25.26 euros. The downgrade by Kepler Cheuvreux, which lowered its recommendation from 'hold' to 'reduce' and adjusted its price target from 27.50 to 25 euros, impacts the railway manufacturer. This revision comes at a time when the manufacturer recently reported an order book exceeding 100 billion euros as of December 31, 2025, with 9.6 billion euros in new orders during the third quarter.
Kepler Cheuvreux's Recommendation Revision
Kepler Cheuvreux's revision of its recommendation for Alstom is based on a more cautious reading of the operational and financial profile of the company. The firm highlights ongoing execution difficulties within the project portfolio, combined with cash generation considered insufficiently predictable. This assessment particularly takes into account the constraints associated with the ramp-up of industrial programs still in their initial phase, a return to more normalized contributions from joint ventures, and capacity utilization rates that remain below expectations in certain markets. According to analysts, these factors could delay the gradual improvement of margins. Additionally, Oxcap Analytics had set a target at 27.40 euros with a market weight on January 22, providing a slight buffer against the current decline.
Technical Analysis of the Stock
From a technical standpoint, the stock is now trading below its 20-day moving average, which is at 25.97 euros, while it remains above its 50-day average (24.41 euros). This drop after a 31.08% increase over the year marks a pause in the momentum, with the support level at 24.08 euros and resistance at 26.87 euros. The RSI at 57 indicates a neutral zone, with no signs of overbuying or overselling, reflecting the indecision of market participants. Alstom also shows a monthly volatility of 8.10%, relatively moderate for a company of this size. The recent order of 15 high-speed Avelia Horizon trains by SNCF Voyageurs, estimated at around 600 million euros with deliveries scheduled for 2029, provides medium-term visibility for the order book. However, investors are closely monitoring the group's ability to convert this activity into cash flow, a central theme of today's broker revision.
