Nexans: Electrification pure play with visibility into 2030
Global cable leader at the heart of the electrification and grid investment supercycle
Welcome to the 29th investment case, 16th reshoring/sovereignty, 13th AI & data center and 9th electrification & grids idea on Crack the Market (and the most comprehensive Nexans investment case you will find online)! Electricity is the new Oil and Nexans is leading us into the Age of Electrification. Join me as I dissect a cable manufacturing giant, coming out of a strategic transformation to become an electrification champion firing on all cylinders with a best in class portfolio of products for high voltage, grids, buildings and construction benefiting from a massive supercycle of investments into electrical grids (+ some reshoring and AI data centers upside).
Twice a week, I will release deep dives into stocks and sectors that fit into the three themes that I see winning in this age of tariffs and deglobalization: resilience, sovereignty & reshoring, China. I will then deep dive into the opportunities in the AI data center value chain.
Take advantage of this once in a generation opportunity to build long term wealth by investing in great stocks that will deliver returns for your portfolio for years to come.
You can already read my first 27 deep dives, all of which I see as winners in this new world of tariffs and deglobalization:
ASML (reshoring & China idea): The most innovative company in the world will 2.5x its EPS by 2030.
LKQ (resilience idea): The most defensive business in the auto industry is a tariff winner and could become a compounder.
Atlas Copco (resilience, reshoring & China idea): The best industrials business in the world is on sale, extremely resilient and will benefit from US reshoring.
Badger Meter (resilience idea): The perfect business in the perfect end market, water meters are the definition of resilience.
Knorr Bremse (resilience idea): Who knew making brakes was this lucrative? Rerating with self help story and upside from German infra plan.
Flex (reshoring idea): The electronics manufacturing giant building Nvidia’s servers and enabling reshoring is becoming a better business.
Itron (resilience & reshoring idea): Riding the grid investment super cycle and enabling smart grids.
Roper (resilience idea): A resilient cashflow compounder in the software space with inflecting growth.
RELX (resilience idea): The company to own forever – one of the very best businesses on Earth.
CPKC (resilience & reshoring idea): The rail connecting Canada/US/Mexico and benefiting from reshoring.
Novo Nordisk (resilience idea): The most exciting pharma company in the world is misunderstood and its growth engine is ready to roar back to life.
Kurita (resilience, reshoring & China idea): Water services expert with improving margins and benefiting from reshoring of semiconductor production.
Halma (resilience idea): High quality compounder in safety, health and environmental technologies.
Quanta Services (resilience & reshoring idea): Countercyclical compounder riding a multi decade infrastructure buildout.
Infineon (China idea): Power semiconductor leader with strong structural drivers (AI power and China auto) amidst a cyclical recovery.
Hubbell (resilience & reshoring idea): Pure play on US electrification demand driven by AI and grid investment cycle.
Iberdrola (resilience & reshoring idea): Best integrated utility in the world with a stellar track record and solid growth driven by networks and renewables
Nvidia (AI & data center idea): The backbone of the AI world is unstoppable.
Veolia (resilience & reshoring idea): Resource management giant (water, waste, energy) due for a rerating.
TJX (resilience idea): The retail giant that keeps winning.
DSM-Firmenich (resilience idea): The diversified ingredient powerhouse benefiting from a transformational deal.
Zoetis (resilience idea): Leader in animal healthcare.
Prysmian (reshoring idea): Global cable leader entering a golden age.
Bentley Systems (resilience & reshoring idea): The software compounder bringing infrastructure into the AI age.
Givaudan (resilience idea): The highest quality and most resilient ingredient compounder has a compelling valuation.
First Solar (reshoring idea): The rising Sun in a new electricity supercycle.
Arcadis (resilience & reshoring idea): An engineering and design consultancy giant poised for a rerating.
Thermo Fisher (resilience & reshoring idea): Life Science tools giant just had its clearing event and is a stealth reshoring winner.
After reading this article, you will understand why this company is so special thanks to its pure play focus on electrification and cables, what it does, why it is seeing such a strong momentum thanks to the beginning of a grid investment supercycle and the electrification of our world, why it is at an inflection point with its businesses firing on all cylinders, its transformation program completed and margins grinding higher.
In this article I go through:
Nexans’ businesses and how its products are at the center of the electrification of our societies.
How the cable markets benefit from high barriers to entry for complex projects and Nexans boasts one of the most advanced fleet of cable laying vessels in the world.
How the company is riding an electrification and grid investment supercycle, with reshoring and AI data centers further boosting the outlook, with visibility on its revenues for the next few years.
How the company aims to deliver MSD growth with a strong focus on margins and cash generation.
How Nexans will become a consolidator of the electrification space with the acquisition of low and medium voltage businesses.
