Leading power and automation technologies supplier ABB Ltd. (ABB) received a contract on Jan 16, 2014, to provide electrical systems for all 36 high-speed trains of Swedish railway — SJ. The contract is valued at $200 million and ABB will book the order in the first quarter of 2014, under its Discrete Automation and Motion division. Following the news, the stock rose 1.3%.
The Swedish railway is Sweden’s state-owned rail operator and plans to invest approximately $510 million in a comprehensive program for the SJ 2000 trains, for which ABB is required to supply and install energy efficient technology. As per the contract, ABB will supply the entire power conversion and control systems on these trains, which will deliver modern technology in the next decade. Apart from the new trains, the existing ones, launched in the late 1980s, will also be equipped with modern interior design.
The first renovated train will be delivered in 2015 and after through testing and evaluation, the rest of the trains will be built incrementally through 2019.
ABB will be providing traction converters, traction transformers, battery chargers, train control systems and infotainment equipment. This project follows ABB’s successful overhaul of high-speed InterCityExpress (ICE 1) trains operated by Deutsche Bahn, Germany’s national rail operator. ABB’s rail business is benefiting from the growing market of equipment of high-speed trains, thanks to the company’s combined power and automation solutions.
Based in Zurich, Switzerland, ABB is a leader in power and automation technologies that enable utility and industry customers to improve performance while lowering negative impacts on the environment.
ABB currently has a Zacks Rank #3 (Hold). However, other stocks which are worth considering at the moment are Quanta Services, Inc. (PWR), Fluor Corp. (FLR) and Crane Co. (CR). All three carry a Zacks Rank #2 (Buy).
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