Siemens Shares Pull Back From Record High as Q2 Stagnation Overshadows €1.2 Billion Mermec Deal

Siemens stock falls nearly 5% after flat Q2 revenue and declining EPS, overshadowing a €1.2B Mermec acquisition. Analyst views are mixed; stock remains technically overbought.

The whiplash hit Siemens investors hard on Friday. Just a day after the stock closed at a 52-week high of €272.20, the shares tumbled nearly five percent to €258.80 by mid-afternoon, making the Munich-based industrial giant the biggest drag on the DAX. Heavy volume — more than 860,000 shares changing hands — underscored the abrupt shift in sentiment.

The trigger for the selloff was the company’s second-quarter performance, which landed with a thud. Siemens generated revenue of €19.76 billion, essentially flat year-on-year, while earnings per share slid from €2.86 to €2.61. In a market already on edge, that profit erosion proved enough to send investors for the exits, even as the stock had been riding a wave of optimism.

That optimism had been fueled by Thursday’s announcement that Siemens Mobility is acquiring the core rail-signaling, electrification and diagnostic businesses of Italy's Mermec Group for around €1.2 billion. Mermec, which employs roughly 1,700 people and posted sales of about €430 million in its fiscal 2025, fits neatly into Siemens’ transport portfolio. The deal is expected to close toward the end of calendar 2026 and to be accretive to earnings per share in its second full year post-completion.

Yet Friday’s price action suggests the market is more focused on the near-term stagnation than the long-term strategic logic. The profit-margin pressure at Siemens’ own portfolio companies only added to the unease. Shares of Siemens Energy lost more than four percent at one point, while Siemens Healthineers drew a fresh price-target cut from Deutsche Bank to €38, with a “Hold” rating centered on the need for a margin recovery next year.

Analyst reaction to the Mermec deal was generally favorable, though opinions diverged sharply on valuation. JPMorgan reiterated “Overweight” with a €335 target, UBS lifted its price objective to €310 with a “Buy” call, and LBBW kept a “Buy” at €325. Deutsche Bank, however, stuck with “Hold” at €255, while Barclays remained the standout bear with “Underweight” and €230. Goldman Sachs upgraded the stock to “Buy,” citing momentum in industrial AI — a reminder that Siemens’ broader positioning in automation and digitization remains a draw.

Technically, the reversal looked overdue. The 14-day relative strength index had hit 81.2, deep in overbought territory. Even after Friday’s retreat, the stock still trades roughly ten percent above its 50-day moving average — or 16.43 percent above that level by some calculations. The year-to-date gain has been trimmed to just over seven percent, well below the nearly 13 percent recorded before the drop.

Investors will now look to July for fresh fundamental data when Siemens reports third-quarter results. The August calendar is also likely to bring the next scheduled financial update, and by the fourth quarter of 2026, management is expected to provide concrete details on the Mermec integration and the strategy for the coming fiscal year. For now, the market has chosen to digest yesterday’s record with a healthy dose of skepticism.