Siemens Energy: A Desert Deal, a Spin-Off Prospect, and a Buyer Beware Signal from Barclays
Published on 07/09/2026 at 13:07 | Redaktion boerse-global.de
Siemens Energy has entered a critical stretch. The stock has climbed roughly 25% year-to-date, recently trading near €153.50, but the advance has been punctuated by profit-taking and a stark warning from Barclays. The British bank downgraded the shares from Equal Weight to Underweight, lifting its target to €130 — a figure that still trails the current price by more than 15%. Yet against that bearish call, the company has lined up a fresh rating upgrade, a massive buyback program, and reports of a radical portfolio shake-up that could unlock billions in hidden value.
The most ambitious catalyst on the table is a potential spin-off of the Transformation of Industry (TI) unit, which builds compressors and energy storage systems. Analysts at Bank of America peg the division’s worth at roughly €12.4 billion. Siemens Energy executives are said to be weighing an IPO or a partial sale, though the company has only confirmed routine portfolio reviews. If management pulls the trigger, the move could force a wholesale revaluation of the equity, which currently commands a market cap north of €130 billion.
Meanwhile, the business itself is punching back against the peak-cycle narrative that underpins Barclays’ caution. Siemens Energy recently secured a major order for two power projects in Oman — Misfah and Duqm — covering gas and steam turbines and generators with a combined capacity of nearly 2.6 gigawatts. The turbines are designed for hydrogen co-firing, aligning with the sultanate’s decarbonisation goals. Crucially, the deal includes long-term service contracts, adding a recurring revenue stream that tends to smooth out cyclical dips in equipment sales.
Should investors sell immediately? Or is it worth buying Siemens Energy?
That order book is already bulging. Over the past six months, Siemens Energy booked more than 50 gigawatts of new orders, a pace well above historical averages. The company’s second tranche of share buybacks is underway, targeting up to €1 billion by the end of September 2026. And the broader roadmap extends further: between its 2026 and 2028 fiscal years, the group plans to return up to €6 billion to shareholders. S&P Global Ratings reinforced the upbeat signal last month, upgrading the credit rating to BBB+ with a stable outlook, citing a sustained improvement in profitability.
A separate, policy-driven catalyst is taking shape on Siemens Energy’s home turf. Berlin is preparing to auction capacity for hydrogen-ready gas power plants, with the first tenders covering 4.5 gigawatts set for 1 September 2026. As a technology leader in the field, Siemens Energy stands to be a direct beneficiary. The margin trajectory supports the optimists: S&P projects an operating margin of up to 14% by 2026, helped by a long-awaited turnaround at the troubled wind-turbine subsidiary, Siemens Gamesa, which is expected to reach breakeven this year.
Yet the risks flagged by Barclays cannot be dismissed. Analyst Vlad Sergievskii argues that the gas turbine cycle is nearing its zenith, with free cash flow forecast to hit a record €7.62 billion in fiscal 2026 before normalisation sets in. A cooling market would depress free cash flow and strain the balance sheet. An often-overlooked cost is also looming in Asia: by 2028, Siemens Energy must increase its stake in Siemens Energy India to 51%, a move analysts estimate will cost roughly $5 billion. If the service business or Gamesa stumble in the meantime, that bill could amplify the financial pressure.
Technically, the shares are trading about 9% above their 200-day moving average of €142.48, a level that large holders will be watching closely. The 52-week high of €195.54 remains a significant milestone. The relative strength index of 43.2 points to a neutral reading, leaving room for a move in either direction. With the company now in a quiet period ahead of its fiscal third-quarter results on 5 August, the market will have to digest the conflicting signals without fresh management commentary — and decide which story ultimately prevails.
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