Morgan Stanley upgrades Belimo on data centre upside, shares jump
BUZZ-Morgan Stanley upgrades Belimo on data centre upside, shares jump ** Belimo BEAN.S shares rise 7.7% after Morgan Stanley upgrades the heating and ventilation solutions maker to "overweight" from "equal-weight" on data centre potential
** "We see data centers as the primary upside driver for Belimo's revenues," MS says, pointing to an extended volume runway and replacement cycles shortening to possibly less than a decade compared with an average of around 25 years
** The broker also notes liquid cooling required for data centres shifts demand towards higher value energy valves
** It expects data centres to make up more than half of the Swiss firm's growth for at least the next three years, reaching around 38% of sales by 2030
** MS sees Belimo cheaper on growth-adjusted EV/EBIT than European peers Siemens SIEGn.DE, ABB ABBN.S and Halma HLMA.L
** "We think the greatest risk is not that competitors disrupt Belimo's product, but rather than DC architecture evolves so that more liquid-cooling content could be sealed and bundled inside CDUs reducing Belimo’s stand-alone specification power," the broker says
** Raises PT by 28% to 1,100 Swiss francs ($1,385)
** Belimo tops Switzerland's midcap index .SMIM, which is up 1.7%
($1 = 0.7942 Swiss francs)
(Reporting by Danny Callaghan)
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