On Gründonnerstag, April 17, 2025, Siemens Energy's shares experienced a remarkable surge, rising over 10 percent to reach 63.74 euros. This impressive performance comes on the heels of unexpectedly strong preliminary results for the second fiscal quarter, prompting analysts to revise their forecasts upward.
The company reported an order intake of 14.4 billion euros, marking a staggering 52 percent increase compared to the previous year. Revenue also saw significant growth, climbing to 9.96 billion euros, which represents a 21 percent increase. Notably, the profit before special items skyrocketed to 906 million euros, more than five times the figure from the previous year, resulting in an impressive operating margin of 9.1 percent.
Two key divisions drove this success: Gas Services and Grid Technologies. Gas Services saw its order intake double to over 7 billion euros, achieving an operating margin of 16.1 percent. Meanwhile, Grid Technologies benefited from high demand, with revenue increasing by 34 percent and margins nearing 20 percent.
Despite the positive news, Siemens Gamesa, a subsidiary focused on wind energy, continued to struggle. The division reported a loss of 249 million euros, though this was an improvement from the previous year's loss of 446 million euros. However, revenues in this sector did increase by 16 percent, providing a glimmer of hope for investors.
In light of these results, Siemens Energy significantly raised its annual forecast. The company now expects revenue growth between 13 and 15 percent for the 2024/25 financial year, a notable increase from the previous estimate of 8 to 10 percent. The profit margin before special items is now projected to be between 4 and 6 percent, up from the earlier target of 3 to 5 percent. Furthermore, Siemens Energy is targeting a profit after tax of up to 1 billion euros, a substantial increase from the previous goal of merely breaking even. The anticipated free cash flow is expected to reach around 4 billion euros.
Market reactions have been overwhelmingly positive, with Siemens Energy's stock nearing its record high of 64.56 euros, achieved in mid-February. Analyst Akash Gupta from JPMorgan noted that the market consensus is likely to see a double-digit rise following these announcements. "The outlook for the energy technology company is very strong and clearly better than expected," he stated.
In contrast, just a day earlier, on April 16, 2025, Siemens Energy's stock had faced losses, falling by 3.4 percent to 56.32 euros in XETRA trading. This decline followed a period of volatility, with the stock hitting a 52-week high of 64.56 euros on February 17, 2025, and a 52-week low of 16.53 euros on April 17, 2024. Analysts had predicted a dividend of 0.051 euros this year, an increase from the previous year's 0.000 euros.
As the market continues to react to these developments, various analysts have adjusted their ratings for Siemens Energy. Deutsche Bank raised its price target from 62 to 74 euros, indicating a potential upside of approximately 16 percent. Goldman Sachs maintained its buy recommendation, while JPMorgan and Jefferies suggested a solid hold level. However, UBS remains skeptical about the stock's future performance.
Overall, the outlook for Siemens Energy appears brighter than ever, with strong financial results and an optimistic forecast that has excited investors and analysts alike. The company’s ability to adapt and thrive in a competitive market, particularly in the gas and power sectors, positions it well for future growth.
As the financial landscape continues to evolve, all eyes will be on Siemens Energy as it prepares to release its final Q2 2025 results on May 8, 2025. Investors and analysts are eager to see if the company can sustain this momentum and continue to deliver impressive results in the coming quarters.
