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1. Company Snapshot

1.a. Company Description

Siemens Aktiengesellschaft, a technology company, focuses in the areas of automation and digitalization in Europe, Commonwealth of Independent States, Africa, the Middle East, the Americas, Asia, and Australia.It operates through Digital Industries, Smart Infrastructure, Mobility, Siemens Healthineers, and Siemens Financial Services segments.The Digital Industries segment offers automation systems and software for factories, numerical control systems, motors, drives and inverters, and integrated automation systems for machine tools and production machines; process control systems, machine-to-machine communication products, sensors and radio frequency identification systems; software for production and product lifecycle management, and simulation and testing of mechatronic systems; and cloud-based industrial Internet of Things operating systems.


The Smart Infrastructure segment offers products, systems, solutions, services, and software to support sustainable transition in energy generation from fossil and renewable sources; sustainable buildings and communities; and buildings, electrification, and electrical products.The Mobility segment provides passenger and freight transportation, such as vehicles, trams and light rail, and commuter trains, as well as trains and passenger coaches; locomotives for freight or passenger transport and solutions for automated transportation; products and solutions for rail automation; electrification products; and intermodal solutions.The Siemens Healthineers segment develops, manufactures, and sells various diagnostic and therapeutic products and services; and provides clinical consulting services.


The Siemens Financial Services segment offers debt and equity investments; leasing, lending, and working capital financing solutions; and equipment, project, and structured financing solutions.Siemens Aktiengesellschaft was founded in 1847 and is headquartered in Munich, Germany.

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1.b. Last Insights on SIE

Siemens' recent performance has been impacted by a mix of factors. The company's €79.7 billion revenue base and €7,956 million net income are being weighed against recent share price moves and value indicators. A recent 7.06% one-month share price decline and 3.72% one-day drop have raised questions about the company's growth and valuation assumptions. Analysts have reworked their models, with JPMorgan and Citi revising their targets and ratings. The company's investments in AI, such as the €200 million AI factory bet, and partnerships, like the one with ACS, are seen as key drivers. Additionally, Siemens Healthineers' Q1 growth, driven by Imaging and Precision Therapy, has been a positive note. However, concerns about the disruption caused by AI and the company's exposure to China have also been raised. Siemens' board changes, including a new CFO, and its share buyback program, which began in February 2024, are also being closely watched.

1.c. Company Highlights

2. Siemens' Q1 FY2026 Earnings: A Strong Start to the Year

Siemens reported a robust financial performance in Q1 FY2026, with revenue growth of 8% to EUR 21.4 billion, driven by strong contributions from all business segments. The company's profit margin rose to 15.6%, exceeding market expectations, while basic earnings per share before purchase price allocation accounting reached EUR 2.8. Actual EPS came in at EUR 2.55, beating analyst estimates of EUR 2.11.

Publication Date: Feb -13

📋 Highlights
  • Record Order Backlog:: Siemens achieved a record EUR 120 billion in order backlog, driven by strong performance in Smart Infrastructure and Mobility.
  • Smart Infrastructure Growth:: Orders rose 22% YoY to EUR 7.2 billion, with electrification and electrical products businesses growing 38% and 22%, respectively.
  • Digital Industries Margin Expansion:: Profit margin hit 17.8%, exceeding expectations, supported by 11% growth in software and 9% in automation revenue.
  • Revenue and Guidance Upgrade:: Group revenue grew 8%, with full-year revenue guidance raised to the upper half of 6-9%, and EPS guidance increased to EUR 10.70-11.10.
  • Strong Free Cash Flow:: Q1 free cash flow was solid, with confidence in achieving double-digit cash return on revenue and a net debt/EBITDA ratio of 0.9.

Segmental Performance

The Smart Infrastructure segment delivered an outstanding performance, with orders up 22% to EUR 7.2 billion, driven by growth in electrification and electrical products businesses. Digital Industries also reported a strong start, with orders 13% above the prior year quarter, and revenue growth of 10%. Mobility's orders increased significantly, with a book-to-bill ratio of 0.90, and revenue growth of 9%.

Outlook and Guidance

Siemens raised its outlook for FY2026, expecting to reach the upper half of the 6-8% comparable revenue growth guidance range. The company also increased its guidance for basic earnings per share before effects from purchase price allocation to a range of EUR 10.70-11.10. As per Ralf Thomas, "the company is confident it will achieve double-digit cash return on revenue in fiscal 2026."

Valuation and Metrics

With a P/E Ratio of 20.09 and an EV/EBITDA of 15.16, Siemens' valuation appears reasonable, considering its strong financial performance and growth prospects. The company's ROE of 16.05% and ROIC of 5.2% indicate a healthy return on equity and invested capital, respectively. The Net Debt/EBITDA ratio of 0.9 and an AA investment-grade rating suggest a robust capital structure.

Implications and Conclusion

Analysts estimate Siemens' revenue growth to be around 6.6% next year. With its strong Q1 performance, raised guidance, and solid capital structure, Siemens appears well-positioned to deliver sustainable growth. The company's commitment to returning value to shareholders is evident in its accelerated share buyback program, which has accumulated a buyback volume of nearly EUR 4.4 billion over the past two years.

3. NewsRoom

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TDengine and Deloitte India Announce an Alliance to Accelerate Industrial Data Modernization

Mar -12

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Siemens to Help Build AI-Ready Scientific Infrastructure as Part of U.S. Department of Energy’s Genesis Mission

Mar -11

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Is Siemens (XTRA:SIE) Offering Value After Recent Share Pullback And DCF Reassessment

Mar -11

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How Retirees Are Using ESGD to Pair ESG Values With International Dividend Income

Mar -11

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NET Power Q4 Earnings Call Highlights

Mar -10

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Paessler Recap: Six PRTG Releases, Siemens Industrial Edge Integration, and 289 New Certified Experts in 2025

Mar -10

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Digital Oilfield Solutions Industry Report 2026-2035: Market to Reach $58.66 Billion by 2030 with Microsoft, Siemens, Intel, IBM, Deloitte, General Electric, Schneider Electric Leading

Mar -10

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Hydrogen (H2) + Renewable Natural Gas (RNG) Fueling Infrastructure Industry Report 2026-2035: A $74.88 Billion Market by 2030 with TotalEnergies, BP, Siemens, Iberdrola Leading

Mar -10

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4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (6.50%)

6. Segments

Industrial Businesses (IB) - Siemens Healthineers

Expected Growth: 7.0%

The healthcare industry is expected to experience significant growth due to aging populations and increasing healthcare needs. Siemens Healthineers is well-positioned to capitalize on this trend, with a strong presence in key markets and a commitment to innovation. The segment's growth is expected to be driven by the increasing demand for diagnostic and therapeutic products.

Industrial Businesses (IB) - Smart Infrastructure

Expected Growth: 6.8%

The demand for smart infrastructure is expected to drive growth in this segment, as cities and buildings become increasingly connected and automated. Siemens is well-positioned to capitalize on this trend, with a strong portfolio of products and services. The segment's growth is expected to be driven by the increasing need for energy efficiency and the adoption of smart technologies.

Industrial Businesses (IB) - Digital Industries

Expected Growth: 8.0%

The demand for digitalization is expected to drive growth in this segment, as manufacturers increasingly adopt Industry 4.0 technologies. Siemens is well-positioned to capitalize on this trend, with a strong portfolio of products and services. The segment's growth is expected to be driven by the increasing need for industrial automation and the adoption of digital technologies.

Industrial Businesses (IB) - Mobility

Expected Growth: 6.2%

The demand for transportation infrastructure is expected to drive growth in this segment, as governments and cities invest in sustainable mobility solutions. Siemens is well-positioned to capitalize on this trend, with a strong portfolio of products and services. The segment's growth is expected to be driven by the increasing need for sustainable transportation systems.

Reconciliation Consolidated Financial Statements

Expected Growth: 0.0%

This segment is not expected to contribute to revenue growth, as it is primarily focused on financial reporting and reconciliation. The growth rate is expected to be minimal, as the segment is not directly related to the company's operational activities.

Siemens Financial Services (SFS)

Expected Growth: 6.5%

The demand for financial services is expected to drive growth in this segment, as industrial customers increasingly require financing options for projects. Siemens is well-positioned to capitalize on this trend, with a strong portfolio of financial products and services. The segment's growth is expected to be driven by the increasing need for financing options for industrial customers.

7. Detailed Products

Industrial Automation

Siemens' industrial automation products and solutions enable the efficient and flexible automation of manufacturing processes, including industrial control systems, industrial communication networks, and industrial software.

Drive Technology

Siemens' drive technology products and solutions provide efficient and reliable electric drives, motors, and gear units for industrial applications.

Digital Grid

Siemens' digital grid products and solutions enable the efficient and reliable transmission and distribution of electrical energy, including smart grid systems and energy storage solutions.

Industrial Software

Siemens' industrial software products and solutions provide a range of tools for product design, simulation, and manufacturing, including computer-aided design (CAD) and product lifecycle management (PLM) software.

Mobility

Siemens' mobility products and solutions provide rail and road transportation systems, including rail electrification, signaling, and train control systems.

Healthineers

Siemens Healthineers provides medical imaging and diagnostics equipment, including MRI and CT scanners, as well as healthcare IT solutions.

Gas and Power

Siemens' gas and power products and solutions provide efficient and reliable power generation, transmission, and distribution systems, including gas turbines and generators.

8. Siemens Aktiengesellschaft's Porter Forces

Forces Ranking

Threat Of Substitutes

Siemens Aktiengesellschaft operates in a industry with moderate threat of substitutes. While there are some substitutes available, they are not a significant threat to the company's business.

Bargaining Power Of Customers

Siemens Aktiengesellschaft has a diverse customer base, which reduces the bargaining power of individual customers. Additionally, the company's products and services are often customized, making it difficult for customers to switch to competitors.

Bargaining Power Of Suppliers

Siemens Aktiengesellschaft has a large and diverse supplier base, which reduces the bargaining power of individual suppliers. However, some suppliers may have significant bargaining power due to their size or specialized products.

Threat Of New Entrants

The capital requirements and regulatory barriers to entry in Siemens Aktiengesellschaft's industries are high, making it difficult for new entrants to enter the market.

Intensity Of Rivalry

Siemens Aktiengesellschaft operates in highly competitive industries, with many established players competing for market share. The company must continuously innovate and improve its products and services to maintain its market position.

9. SWOT Analysis

Strength

Weaknesses

Opportunities

Threats

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

Value
Debt Weight 49.37%
Debt Cost 3.95%
Equity Weight 50.63%
Equity Cost 10.22%
WACC 7.12%
Leverage 97.50%

11. Quality Control: Siemens Aktiengesellschaft passed 4 out of 9 key points

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

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A-Score: 5.2/10

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Growth: 5.0

Quality: 5.6

Yield: 5.0

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Yield: 5.6

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A-Score: 4.1/10

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Quality: 6.6

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Peers Metrics

12.e Scoring Insights

12.f DCF BETA

Parameters

Short Term Growth

Short term Time

Long-Term Growth

WACC

Target Price

220.35$

Current Price

220.35$

Potential

-0.00%

Expected Cash-Flows