MS stays positive on mining gear seeing multi-year up-cycle for upstream names
12/03/2026 13:52
** Morgan Stanley remains positive on European mining equipment companies, citing a multi-year growth upcycle driven by strong commodity prices and resilient aftermarket business ** Broker continues to favour upstream equipment makers, which benefit first from miners replacing old machinery and have strong barriers to entry against competition ** It switches its preference to Swedish mining gear firm Epiroc EPIRa.ST over rival Sandvik SAND.ST, citing accelerating mining orders and more sustainable EBITA growth out to 2028 ** MS upgrades Epiroc to "overweight" from "equal weight", stating the "'valuation elastic band has become too stretched", and cuts Sandvik to "equal weight" from "overweight" ** The brokerage sees more scope for Epiroc orders to beat consensus than Sandvik, adding that tailwinds for the latter's machining arm from tungsten can create volatility ** For Weir Group WEIR.L, MS maintains an "equal weight" rating and raises its PT to 3,200p on valuation roll-forward, though it notes the story is complicated by its push into software ** It also keeps Metso METSO.HE at "equal weight" with a higher PT of EUR 16.5, viewing its valuation as fair and seeing significant margin expansion already priced in by the market
| COMPANY | NEW RATING | OLD RATING | NEW PT | OLD PT |
| Epiroc | overweight | equal weight | SEK 262 | SEK 212 |
| Sandvik | equal weight | overweight | SEK 356 | SEK 310 |
| Metso | -- | equal weight | EUR 16.5 | EUR 13.2 |
| Weir Group | -- | equal weight | 3200p | 2590p |