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1. Company Snapshot

1.a. Company Description

Rexel S.A., together with its subsidiaries, distributes electrical products and services for the residential, commercial, and industrial energy markets worldwide.The company offers smart cameras, sensors, controllers, and monitoring software; light sources, lights, and control switches; climate control products, including heat pumps, air conditioning, and water heaters; fire alarms, surveillance equipment, access controls devices, and emergency lightings; and connection cables, and switches and routers, as well as enclosures, mounts, and racks.It also provides solar modules and inverters; connected lighting, intelligent home system, home control touch screen, and smart thermostat products; residential chargers, commercial stations, and charging cables for electric vehicles; electric motors, variable speed drives, programmable logic controllers, and computers and operator interface; and fastening systems, electrical power and control, and valves and instrumentation products.


The company offers products, services, and solutions in the fields of technical supply, automation, and energy management related to the construction, renovation, maintenance, and production.It operates a network of approximately 1,900 branches in 24 countries.The company was founded in 1967 and is headquartered in Paris, France.

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1.b. Last Insights on RXL

Rexel's recent performance was driven by accelerating same-day sales growth, fueled by North American volume and pricing. The company's Q2 sales and H1 2025 results showed a positive momentum, with sales up +1.6% on a same-day basis. Non-cable selling prices rose +0.9%, with a positive impact from US tariffs. Rexel's profitability remained resilient, thanks to self-help actions. The company confirmed its full-year guidance, despite a challenging European environment. Additionally, Rexel's share buyback program, which aims to reduce outstanding shares, has been ongoing, with several purchases made in August.

1.c. Company Highlights

2. Rexel's 2025 Earnings: Strong Performance and Positive Outlook

Rexel's financial performance in 2025 was impressive, with same-day sales growth of 2.5%, exceeding initial guidance, and a current adjusted EBITA margin of 6%, in line with expectations. Earnings per share (EPS) came in at 1.19, slightly beating analyst estimates of 1.18. The company's free cash flow conversion before interest and tax reached 76%, well above the guided range of above 65%. Revenue growth was driven by a combination of organic performance, acquisitions, and pricing actions, with the company reporting a net debt increase of EUR 147 million, mainly due to net financial investments and dividend payments.

Publication Date: Feb -18

📋 Highlights
  • Outperformance & Margin Resilience:: Achieved +2.5% same-day sales growth and 6% current adjusted EBITA margin, aligning with guidance despite mixed market conditions.
  • Free Cash Flow Strength:: 76% free cash flow conversion before interest and tax, exceeding guidance of above 65% (excluding EUR 124m anti-trust fine).
  • Digital Penetration Growth:: Over 1/3 of sales via digital channels, with annual digital adoption growth of 200-300 basis points driven by AI tools and customer experience improvements.
  • AI Adoption Momentum:: 50% of U.S. quoting teams use AI tools, and 25% of email quotes in France handled via AI, boosting productivity to 2.8% in 2025 (vs. 0.9% in 2016-2021).
  • 2026 Guidance:: Projects 3-5% sales growth and 6.2% current adjusted EBITA margin, building on 2025’s 300 bps margin improvement and 7.5% organic sales growth.

Segment Performance

The company's performance varied across regions, with North America focusing on profitable growth and capturing trends in higher-growth segments, while Europe faced a more muted environment with negative volumes and flat pricing. Data centers in North America emerged as a key growth platform, with strong momentum in Q4 and across the year, driven by dedicated teams and branches. The company's digital penetration continued to gain traction, with over 1/3 of sales going through digital channels, and it is now accelerating the adoption of AI-based tools to boost sales force productivity.

Guidance and Outlook

Rexel's 2026 guidance reflects continued growth, with expected sales growth of 3% to 5% and a current adjusted EBITA margin of around 6.2%. The company's medium-term objectives include sales growth of 5% to 8%, an adjusted EBITA margin above 7%, and cash conversion of 65%. Guillaume Jean Texier noted that the company is "leaning into high-growth verticals, accelerating GenAI adoption, reinforcing cost initiatives, and pricing support," which should help drive future performance. Analysts estimate next year's revenue growth at 4.2%, indicating a positive outlook for the company.

Valuation

Using various valuation metrics, we can assess what's priced into Rexel's stock. The company's P/E Ratio stands at 43.51, indicating a relatively high valuation compared to its earnings. The P/B Ratio is 2.0, and the P/S Ratio is 0.55, suggesting a moderate valuation relative to its book value and sales. The EV/EBITDA ratio is 12.41, and the Dividend Yield is 3.3%, indicating a reasonable valuation relative to its earnings and dividend payments. The Free Cash Flow Yield is 5.26%, suggesting a decent return for investors. Overall, Rexel's valuation metrics indicate a relatively balanced valuation, considering its growth prospects and financial performance.

3. NewsRoom

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Is It Too Late To Consider Rexel (ENXTPA:RXL) After A 45% One Year Rally?

Feb -15

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Rexel SA (RXEEY) Full Year 2025 Earnings Call Highlights: Strong Growth Amid Market Challenges

Feb -11

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Rexel : Erratum to the Press release Q4 sales & FY 2025 results

Feb -11

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Rexel extended its presence within ARGAN’s portfolio

Feb -10

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QXO Is Raising Another $1.8 Billion for Its M&A War Chest

Jan -12

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Is It Too Late To Reassess Rexel (ENXTPA:RXL) After Its Strong Multi Year Rally?

Jan -09

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Rexel: biannual sharebuyback program at December 31, 2025

Jan -08

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REXEL: Change in Rexel’s financial agenda

Jan -06

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4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (8.35%)

6. Segments

Warehouse

Expected Growth: 8%

Rexel S.A.'s warehouse segment growth of 8% is driven by increasing demand for energy-efficient solutions, expansion into new markets, and strategic acquisitions. Additionally, the company's focus on digitalization and e-commerce platforms has improved customer experience, leading to increased sales. Furthermore, Rexel's efforts to optimize its logistics and supply chain have resulted in cost savings, which have been reinvested in growth initiatives.

Direct

Expected Growth: 10%

Rexel S.A.'s 10% growth driven by increasing demand for energy-efficient solutions, expansion in emerging markets, and strategic acquisitions. Additionally, the company's focus on digital transformation, cost savings initiatives, and strong relationships with suppliers contribute to its growth momentum.

Rebates, Discount and Services

Expected Growth: 7%

Rexel S.A.'s 7% growth driven by strategic rebates to loyal customers, competitive discounts on bulk purchases, and value-added services such as energy-efficient solutions and technical support, enhancing customer stickiness and attracting new clients in the electrical distribution market.

7. Detailed Products

Electrical Distribution

Rexel S.A. offers a wide range of electrical distribution products, including circuit breakers, switchgear, and electrical panels, designed to ensure safe and efficient distribution of electrical power.

Lighting and Luminaires

Rexel S.A. provides a comprehensive range of lighting and luminaire products, including LED lighting, industrial lighting, and emergency lighting, designed to meet specific application requirements.

Industrial Automation and Control

Rexel S.A. offers industrial automation and control products, including programmable logic controllers (PLCs), human-machine interfaces (HMIs), and sensors, designed to optimize industrial processes and improve efficiency.

HVAC and Refrigeration

Rexel S.A. provides heating, ventilation, and air conditioning (HVAC) and refrigeration products, including air conditioning units, heating systems, and refrigeration equipment, designed to maintain comfortable indoor environments.

Security and Access Control

Rexel S.A. offers security and access control products, including CCTV cameras, intrusion detection systems, and access control systems, designed to ensure safety and security.

Data and Communication

Rexel S.A. provides data and communication products, including network infrastructure, data cabling, and communication equipment, designed to support high-speed data transmission and communication.

8. Rexel S.A.'s Porter Forces

Forces Ranking

Threat Of Substitutes

Rexel S.A. operates in the electrical distribution industry, where substitutes are limited. However, the increasing adoption of energy-efficient solutions and renewable energy sources may pose a moderate threat to the company's business.

Bargaining Power Of Customers

Rexel S.A. has a diverse customer base, including electrical contractors, industrial companies, and retailers. While some large customers may have bargaining power, the company's broad customer base mitigates this risk.

Bargaining Power Of Suppliers

Rexel S.A. relies on a network of suppliers for its products. While the company has established relationships with its suppliers, it is still exposed to supplier concentration risks and potential price increases.

Threat Of New Entrants

The electrical distribution industry has high barriers to entry, including significant capital requirements and complex logistics. New entrants would need to invest heavily to establish a competitive presence.

Intensity Of Rivalry

The electrical distribution industry is highly competitive, with several established players competing for market share. Rexel S.A. faces intense competition from rivals, which may lead to pricing pressure and margin erosion.

9. SWOT Analysis

Strength

Weaknesses

Opportunities

Threats

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

Value
Debt Weight 35.49%
Debt Cost 5.85%
Equity Weight 64.51%
Equity Cost 11.83%
WACC 9.71%
Leverage 55.02%

11. Quality Control: Rexel S.A. passed 6 out of 9 key points

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

Stock-Card
Computacenter

A-Score: 6.0/10

Value: 4.7

Growth: 6.9

Quality: 5.9

Yield: 4.4

Momentum: 8.0

Volatility: 6.3

1-Year Total Return ->

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Stock-Card
AB

A-Score: 6.0/10

Value: 7.6

Growth: 6.3

Quality: 4.9

Yield: 4.4

Momentum: 6.0

Volatility: 6.7

1-Year Total Return ->

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Stock-Card
Avnet

A-Score: 5.5/10

Value: 7.3

Growth: 5.4

Quality: 3.2

Yield: 6.0

Momentum: 3.0

Volatility: 8.0

1-Year Total Return ->

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Stock-Card
Rexel

A-Score: 5.5/10

Value: 4.6

Growth: 5.2

Quality: 3.0

Yield: 6.9

Momentum: 7.5

Volatility: 5.7

1-Year Total Return ->

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Stock-Card
Indra Sistemas

A-Score: 5.3/10

Value: 3.3

Growth: 6.8

Quality: 6.1

Yield: 1.9

Momentum: 10.0

Volatility: 4.0

1-Year Total Return ->

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Stock-Card
ALSO Holding

A-Score: 4.6/10

Value: 6.0

Growth: 3.9

Quality: 4.8

Yield: 3.1

Momentum: 3.0

Volatility: 7.0

1-Year Total Return ->

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Peers Metrics

12.e Scoring Insights

12.f DCF BETA

Parameters

Short Term Growth

Short term Time

Long-Term Growth

WACC

Target Price

33.68$

Current Price

33.68$

Potential

-0.00%

Expected Cash-Flows