Siemens Energy's Grid Engine Generates Enough Cash to Lift Buyback to €3bn as Wind Woes Persist
31.05.2026 - 10:22:06 | boerse-global.de
Siemens Energy is living a double life. On one side, the grid division is on a tear — orders are flooding in, free cash flow is surging, and management just accelerated a share buyback program to as much as €3bn. On the other, the wind turbine subsidiary Gamesa remains a persistent drain, bleeding €654m in free cash flow in the quarter and delaying its breakeven to the end of the fiscal year. Investors are weighing which story will ultimately define the stock.
The half-year numbers put the contrast in sharp relief. Revenue hit nearly €20bn and net profit reached roughly €1.44bn, with earnings per share more than doubling year-on-year. The company raised its comparable revenue growth forecast to a range of 14% to 16%, powered largely by a grid business that posted margins above 17% in the second quarter. Group margin before special items stood at 11.3%. The order book has swelled to around €154bn, with 93% of second-half deliveries already locked in.
That cash generation gave the board confidence to boost the existing buyback program by a third, from €2bn to €3bn. The first tranche is already done: between March and May, Siemens Energy repurchased roughly 12.6m shares at an average price of €158.50. Free cash flow before taxes jumped 42%, and the full-year expectation for free cash flow has been doubled to €8bn — giving the company ample room to fund transformation while returning capital to shareholders.
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Yet Gamesa continues to act as an anchor. CEO Christian Bruch confirmed that the wind unit won't reach breakeven before the fourth quarter of 2026 at the earliest. The negative free cash flow of €654m underscores the scale of the restructuring challenge. While the network infrastructure business — especially in the US, where orders doubled to €6.94bn and revenue rose 45.7% — is humming, Gamesa is still consuming resources that could otherwise flow to growth or buybacks. Siemens Energy plans to invest roughly €2bn in grid infrastructure by 2028.
The market's response has been muted. The stock closed Friday at €162.60, down 6.4% on the week and roughly 13% below its 52-week high of €188. The rally over the past year — still up 92.5% — is undergoing a consolidation phase. Technically, the shares trade 21.9% above the 200-day moving average of €133.43, while the relative strength index at 53.1 points to a neutral posture. Annualized volatility hovers near 50%, a reminder that even a €100bn-plus market cap is not immune to sharp swings. Key supports lie at €150 and the 100-day line at €158.76.
Analyst forecasts reflect the uncertainty around Gamesa. The target range is exceptionally wide: Barclays sees the stock at €110, while JPMorgan goes to €225. The consensus average sits around €195, with 19 of 21 analysts recommending a buy. The next quarterly report in August will be a test of whether the upgraded guidance translates into sustainable cash generation and whether Gamesa's recovery is on track. For now, Siemens Energy offers a bet on the global electrification theme — but one that still carries the weight of its troubled wind unit.
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