ENR.DE — Deck
Siemens Energy builds and services gas turbines, grid equipment, industrial power systems, and wind turbines, making money from long-cycle equipment projects and recurring service on installed energy infrastructure.
The cash guide doubled; the stock already believed it.
- April reset. On April 23, 2026, Siemens Energy lifted FY2026 FCF pre-tax guidance to around €8.0B from €4.0B–€5.0B, with comparable revenue growth now 14%–16% and margin before special items 10%–12%. Preliminary Q2 orders of €17.7B beat consensus by 14%.
- Valuation caught up. At €187.62, the shares sit above the €175.52 average analyst target. EV/revenue is 3.86× versus a 0.73× post-spin average, and the base-case scenario lands near €187.
- Proof still lags cash. The same Q2 pre-release missed consensus on revenue, profit before special items, and net income; Siemens Gamesa still posted negative €654M FCF pre-tax. The next test is whether the €8.0B guide converts into margin, not just customer advances.
Gas and grid pay the bills; Gamesa still takes a toll.
Scarce gas slots and grid capacity let the company demand better terms and customer advances; that is why cash is moving before EPS fully catches up. The group works if Gas and Grid hold mid-teens margins while Gamesa reaches cash breakeven; it breaks if wind provisions or capacity bottlenecks absorb the backlog premium.
The story moved from wind rescue to capacity scarcity.
Before: In FY2023, Siemens Gamesa quality failures turned the spin-off into a financing story: the wind unit lost €4.3B before special items, including €2.7B of quality charges, and group net loss hit €4.6B. Demand was not the problem; credibility was.
Pivot: FY2024 and FY2025 bounded the damage. Backlog rose from €123B to €138B, FY2025 FCF pre-tax reached €4.7B, government-backed guarantees were replaced early, the dividend restriction was lifted for FY2025, and an up to €6.0B buyback began in March 2026.
Today: Management now says demand is real and capacity is the bottleneck: gas-turbine slots are sold out through FY2028, FY2029 is filling, and Grid Technologies runs around or above 2× book-to-bill. That makes execution speed, supplier depth, and contract margin the new risk.
Lean cautious — operating momentum is real, but the multiple needs clean cash.
- For. The order engine is working: FY2026 FCF pre-tax guidance is around €8.0B, Q1 FY2026 backlog was €146B, Q2 preliminary orders were €17.7B, and Q2 preliminary Gas Services and Grid Technologies margins were 15.9% and 17.1%.
- For. The balance sheet has left the rescue phase: FY2025 net cash recovered to €5.2B, shareholders approved a €0.70 dividend in February 2026, and the buyback authorization runs up to €6.0B through FY2028.
- Against. The stock has little valuation cushion: EV/revenue is 3.86× versus a 0.73× post-spin average, the average analyst target sits below the last close, and the bear scenario is around €140 if the market pays 2.5× EV/revenue.
- Against. Gamesa still blocks the clean-compounder label: FY2025 profit before special items was negative €1.4B, FY2025 FCF was negative €1.8B, and preliminary Q2 FY2026 FCF pre-tax was still negative €654M.
Watchlist to re-rate: May 12 Q2 FCF bridge and Gamesa cash; August 5 Q3 margin and working-capital bridge; daily closes above €192 or below €160 as the market's proof/failure line.