Voestalpine Keeps Two Buy Ratings Even as Cash Flow and Kindberg Cuts Test the Bull Case
Published on 11/12/2026 at 17:21 | Editorial boerse-global.de
Two of Europe's best-known research houses are sticking with their buy calls on Voestalpine, even as both trim their expectations for the Austrian steelmaker. UBS and Deutsche Bank reaffirmed their positive ratings on Monday, with price targets held at EUR 64 and EUR 63 respectively — a show of confidence that sits alongside noticeably more cautious earnings assumptions.
The sticking point is free cash flow. Both brokers trace the shortfall mainly to a build-up in working capital rather than a structural breakdown in the business. Deutsche Bank describes the second-quarter EBITDA of EUR 351 million for fiscal 2026/27 as broadly in line with expectations, attributing the temporarily higher capital tied up in operations to logistics problems. On that reading, the weak cash generation is a timing issue — provided the tied-up capital actually unwinds.
Deutsche Bank trims medium-term numbers
That caveat matters, because Deutsche Bank is not standing still on its forecasts. The bank has cut its EBITDA estimates for the 2027 to 2029 fiscal years by 3% to 7%, meaning its buy recommendation now rests on more modest earnings expectations than before. For investors, the reduction of committed capital becomes the litmus test of the positive thesis.
UBS reaches a similar conclusion by a different route. Analyst Andrew Jones judged the results negatively, though he characterised the miss against EBITDA consensus as moderate. Like Deutsche Bank, he pins the soft free cash flow primarily on working capital build. The lowered guidance for fiscal 2026/27 implies an EBITDA roughly 6% lower, according to the Swiss bank — an earnings hit acknowledged even as the buy rating stays in place.
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Guidance ceiling comes down
Behind the revised modelling sits last week's guidance cut. Voestalpine now expects EBITDA of EUR 1.6 billion to EUR 1.7 billion for the current fiscal year, down from a previous range whose upper end reached EUR 1.85 billion. The lower bound was left untouched — a detail that gives investors a concrete floor against which to measure the rest of the year.
Management pointed to higher energy and logistics costs stemming from the Middle East conflict, delayed energy projects and additional temporary US tariffs as the drags on the second half. Those factors argue against any quick operational relief for as long as they weigh on costs and project execution.
A half-year lifted by one-offs
The interim figures themselves were stronger. First-half EBITDA for 2026/27 rose 17.1% to EUR 846 million, while EBIT climbed 36% to EUR 470 million on revenue that was essentially flat at EUR 7.7 billion. Efficiency measures contributed, and roughly EUR 100 million of positive one-off effects in the High Performance Metals division — chiefly the sale of voestalpine BÖHLER Profil — flattered the result. That gain limits how far the headline improvement can be read as a run-rate signal.
UBS's current-year estimates put earnings per share at EUR 3.49 and the dividend at EUR 1.22, both analyst projections.
Kindberg puts a number on the pressure
The tariff burden is no longer abstract. On Monday the group announced around 150 job cuts at its Kindberg site by the end of March 2027, citing US tariffs and difficult conditions in alternative markets. A social plan is to be drawn up with the works council by the end of November 2026, giving the adjustment a concrete timetable.
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The combination is what makes the risk tangible: shifting volumes to other markets can only partly offset the pressure if conditions there remain difficult too. Under those circumstances, Voestalpine would have to defend its earnings progress against persistent headwinds.
What has to go right
For the bulls, the case hinges on two tests. The first is whether the temporary capital build reverses — a relief that looks plausible only if less cash stays tied up in operations, and one that sustained logistics problems would undermine. The second is whether cost measures can absorb the external pressures while the narrowed guidance range holds.
Stable earnings within that range would support the view that the half-year advance reflects genuine operational resilience. A further deterioration in tariffs and alternative markets, by contrast, would put the remaining earnings framework at risk. Until the cash comes back and the Kindberg adjustment plays out, the conviction of both research houses rests on execution rather than on the numbers already delivered.
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