Siemens Charts a New Course: Record Orders and a Radical Overhaul Fuel the Rally

Siemens shares climb 21% above 52-week lows, backed by a record €120B order book and a sweeping internal reorganization that could reshape its core divisions.

Siemens has clawed back more than a fifth of its value from the spring lows, with shares now trading at €246.55 — roughly 21% above the 52-week trough of €202.80 hit in late April. The stock has also reclaimed ground above its 200-day moving average of €236.72, a technical milestone that underscores the breadth of the recovery. But beneath the surface price action lies a deeper story: a company in the midst of its most ambitious restructuring in years, backed by an order book that has never been bigger.

The industrial conglomerate’s backlog has swelled to an all-time high of €120 billion, a figure that provides a formidable cushion against macroeconomic uncertainty. In the first quarter, industrial profit climbed 15% year-on-year to €2.9 billion, while order intake on a comparable basis rose 10%. The book-to-bill ratio stood at a healthy 1.12, with the Smart Infrastructure division posting an even more impressive 1.30 — driven by surging demand for power grid upgrades and data center capacity worldwide.

That momentum has emboldened management to nudge up its full-year earnings forecast. Siemens now expects earnings per share for fiscal 2026 to land in a range of €10.70 to €11.10, a modest upward revision that reflects confidence in the underlying business. The next major test comes on May 13, when the company releases second-quarter results, with all eyes on whether Smart Infrastructure can sustain its torrid pace amid lingering tariff headwinds.

Yet the most dramatic catalyst for the stock may not be operational at all. CEO Roland Busch is pushing ahead with a sweeping internal reorganization that would dissolve two of Siemens’ core divisions — Digital Industries and Smart Infrastructure — and replace them with six or seven smaller, more agile units. The plan, first reported by Handelsblatt and confirmed to Reuters by a person familiar with the matter, is designed to break down silos and unify infrastructure, transport, software, and artificial intelligence under a single "One Tech Company" strategy. The supervisory board and employee representatives are expected to discuss the overhaul in May 2026. The Mobility division, focused on rail technology, will remain untouched.

Running in parallel is the long-awaited separation of Siemens Healthineers. Shareholders will vote on a direct spin-off of the remaining stake at the annual general meeting in February 2027 — an unusual transaction structure under German transformation law that would see Siemens investors receive Healthineers shares directly. Regulatory clearance is still pending, but the path is becoming clearer.

The restructuring carries both promise and risk. Bernstein analysts see strategic merit in the move, even if execution typically takes time. The valuation gap with peers remains stark: Siemens trades at roughly 13 times expected 2027 operating profit, while competitors like Schneider Electric and ABB command nearly 19 times. A capital markets day in the second half of the year is expected to lay out new medium-term targets, potentially including higher margin ambitions for the software business, which has historically lagged pure-play software companies.

For now, investors are weighing three key uncertainties: the impact of AI on Siemens’ software portfolio, signs of softening short-cycle demand, and the risk that the reorganization creates more confusion than clarity in the near term. The share buyback program — which saw Siemens repurchase nearly 800,000 shares on XETRA between April 13 and 19 at average prices between €227 and €243 — continues to provide structural support. The program, announced in November 2023, authorizes up to €6 billion in buybacks over a maximum of five years.

With a record order book, a bold new corporate structure taking shape, and a stock that still trades at a discount to its peers, Siemens is positioning itself for a transformation that could redefine its trajectory for years to come.