Siemens Energy: Record Orders Fuel the Rally as Activists and Policy Risks Loom

Siemens Energy Q2 record orders €17.7B, lifts guidance. Stock up 33% YTD. Activist pushes Gamesa spin-off. Germany renewable jobs 436,000 but policy risks loom.

The renewable energy sector in Germany has hit a milestone — 436,000 jobs, according to a fresh study from the Bertelsmann Stiftung, with wind power alone accounting for 131,000 positions. Yet the same report carries a stark warning: any policy shift that cuts solar subsidies or leaves grid congestion rules unclear could put those jobs and billions in investment at risk. For Siemens Energy, whose wind turbine arm Siemens Gamesa has been a persistent drag, the message lands at a delicate moment.

Operationally, the Munich-based conglomerate is firing on all cylinders. In the second quarter of its 2026 fiscal year, the company posted record orders of €17.7 billion, a jump of nearly 30% year on year. Net profit hit €835 million, while pre-tax cash flow surged 42%. Management has lifted its full-year guidance to revenue growth of 14-16% and a net profit target of around €4 billion. The next quarterly update is due on 5 August.

Investors have taken note. The stock recently changed hands at €164.42, up 2.68% on the day, after earlier in the week climbing 3.07% to €163.36. That leaves the shares roughly 15% below their 52-week high, but the year-to-date gain stands at 33%. The 200-day moving average at €139.66 provides a solid floor. Still, with a price-to-earnings multiple north of 63, there is little room for disappointment — particularly if supply chain bottlenecks or capacity constraints slow down the execution of that record order book.

Meanwhile, Siemens Energy is pressing ahead with a massive share buyback programme. Between 15 and 21 June alone, the company repurchased 573,670 of its own shares. Since the start of the current tranche on 4 June, the total exceeds 1.5 million shares. The overall programme is worth €6 billion, and the second tranche of up to €1 billion is expected to be completed by the end of September.

But activists want more. US investor Ananym has built a stake in the company and is pushing for a spin-off of Siemens Gamesa, arguing that such a move could unlock a 60% uplift in shareholder returns. The wind power unit posted an operating loss of €1.36 billion in 2025, though it is expected to reach breakeven this year and to target an operating margin of 3-5% by 2028. Separately, management is already examining a potential separation of the Transformation of Industry division, which combines classic steam turbines with emerging hydrogen electrolysis technology — a move designed to sharpen the group’s profit profile.

The Bertelsmann study adds a layer of political uncertainty. Germany’s renewable energy sector added thousands of jobs in 2025, yet the foundation warns that a change in government policy — for instance, reduced support for solar or ambiguous rules on grid bottlenecks — could stall further expansion. For Siemens Energy, any slowdown in onshore wind or grid infrastructure investment would directly affect its core business, even as the company benefits from a global supercycle in power transmission.

Analysts remain broadly bullish. The average price target of €195.08 implies roughly 19% upside from current levels, and 15 out of 19 analysts covering RWE — a peer also discussed in the same week — rate that stock a buy. The key risk for Siemens Energy is whether the political framework can keep pace with its own ambitions. The company is banking on strong growth; the sector is banking on policy stability. If the partnership holds, the record order book and buyback programme should continue to support the share price. If it falters, the lofty valuation leaves little cushion.