Schindler Holding

Schindler is probably one of the least-followed quality compounders in the SMI in 2026. The Swiss elevator and escalator manufacturer finally turned the margin corner in 2025 after three difficult years (China property crisis, raw-material cost spikes). Q1/2026: group revenue CHF 2.9B (+4.2% YoY), adjusted EBIT margin 12.8% (10.9% prior year), free cash flow CHF 380M.

The 2026 structural story rests on an often-underestimated factor: the service business (maintaining 1.7M installed elevators globally) is now 65% of group revenue at 27% gross margins (vs. 18% in the new-equipment business). That is a long-duration, predictable, recession-resistant revenue stream with 10–20-year contract durations. (1) Urbanization growth: emerging markets (India, Vietnam, Indonesia) install 80–100k new elevators per year per country — Schindler has 18–25% share in each. (2) Modernization wave: Europe has 5M installed elevators older than 25 years that will be modernized over the next decade — average CHF 30k of service revenue per upgrade. (3) AI-driven service: Schindler Ahead (IoT platform for predictive maintenance) crossed 500k connected units in 2026.

The dividend story is classically Swiss-solid: Schindler has raised the dividend in 16 out of 16 years since 2010. Current CHF 4.50/share, planned CHF 4.80 for FY2025 — 1.7% yield, not spectacular but with highly secure growth.

The shareholder register is unusually concentrated and stable in 2026: the Schindler-Bonnard family (via the Schindler Holding) directly owns 60.8% of the voting registered shares — keeping the free float thin. On the participation certificate (which is what SCHN.SW trades) liquidity is better: BlackRock at 4.2%, Norges Bank 1.9%, Capital Group 2.1%.

Notable mover: Fundsmith Equity (Terry Smith) opened a first Schindler position in Q1/2026 — unusual for a manager who traditionally prefers US quality compounders. His rationale: ‘If you want the perfect compounder in Swiss industrials, this is it’. Sell-side: UBS raised Schindler to European Top Pick in industrials in 2026.

Schindler trades at 23× 2026 P/E and 14× EV/EBITDA — a premium justified by the service mix and very high FCF conversion (95%+). A DCF using 7.5% WACC and 3% terminal growth yields a fair-value range of CHF 290–325. The current price (~CHF 270) sits 7–17% below fair value — not spectacular, but cheap enough for DCA savings plans. Dividend yield 1.7% on a 16-year growth ladder.

1. July 2026: Q2/2026 earnings with an update on China stabilization and the India growth pipeline. Market expects 13.5%+ EBIT margin.
2. October 2026: Capital Markets Day with refreshed mid-term plan to 2028. Market expects the EBIT margin target to lift from 14% to 15%.
3. March 2027: AGM with the CHF 4.80/share dividend vote (planned). The 17th consecutive hike — a compounder signal.

Schindler in 2026 is the classic ‘unspectacular quality compounder’ I happily hold long-term. The 1.7% yield is small, but 6–8% annual FCF growth plus CHF diversification plus the service-business moat make it a 20-year buy-and-hold. I run 2.5% portfolio weight via monthly DCA in CHF. If you want higher yields, Erste Group or BMW are better — but for the SMI compounder anchor, Schindler is the right tool.