Voestalpine Doubles in a Year as Rail Orders and EU Carbon Curbs Offset Stagnant Auto Demand

Despite steelworker protests, Voestalpine shares rally 110% in 12 months as rail infrastructure and aerospace replace automotive weakness; net profit surges 138%, EU carbon rules boost, US tariffs weigh.

Voestalpine is staging an unlikely rally. While 10,200 steelworkers took to the streets last Friday — 8,500 in Völklingen and another 1,700 marching on Berlin’s economy ministry — the company’s shares climbed to €47.36 by Monday, a 1.89% jump from the Friday close of €46.48. That move extends a twelve-month gain of roughly 110%, pushing the stock within 3.8% of its 52-week high of €49.22.

The disconnect between industrial anger and market optimism has a concrete explanation: Voestalpine is successfully decoupling from the weak automotive sector. The Metal Forming division remains under pressure from sluggish car demand and German plant restructurings. But heavy lifting now comes from two far brighter segments – rail infrastructure and aerospace. As the global leader in railway systems, the group is capturing orders from Europe’s multibillion-euro network upgrades, while booming aircraft production drives demand for specialty steels. The result: an operating profit that has surged even as revenue slipped.

For the 2025/26 financial year, EBITDA hit €1.5 billion and EBIT jumped 59% to €724 million. Net profit after tax soared 138% to €424 million, achieved on slightly lower revenue of €15.1 billion. The growth was entirely margin-driven, not volume-driven. Meanwhile, net financial debt fell 23% to €1.3 billion, pushing the gearing ratio to 16.2% – its lowest level in two decades – despite hefty spending on the greentec steel programme.

That transformation project is the linchpin of Voestalpine’s long-term strategy. The company is investing roughly €1.5 billion to build electric arc furnaces in Linz and Donawitz, with the first unit expected to start operations in early 2027. The aim is to cut annual CO? emissions by nearly four million tonnes by 2029 — a move that will bolster competitiveness under the EU’s emissions trading system and the Carbon Border Adjustment Mechanism (CBAM), which has been pricing carbon into steel imports since January.

The regulatory tailwinds extend beyond carbon. From 1 July, duty-free import quotas into the EU will halve to 18.3 million tonnes, while the out-of-quota tariff doubles to 50%. A melt-and-pour traceability requirement kicks in from October. For Voestalpine, that means structural cost relief: emissions-intensive imports become pricier, narrowing the gap with European producers. The US remains a thorn, however. Since June 2025, 50% US tariffs on steel have cost the company a high-double-digit million-euro hit, and geopolitical tensions — from the Middle East to the fraying transatlantic relationship — will continue to colour the current year.

Despite those headwinds, management has guided for EBITDA of €1.60 billion to €1.85 billion in 2026/27. A new payout policy will accompany that: 30% of earnings per share are to be distributed to shareholders as long as net debt stays below two times EBITDA. The annual general meeting in July is set to vote on a dividend of €0.75 per share, implying a similar payout ratio.

The market is betting on more upside. UBS raised its price target to €50 in June, while the relative strength index at 53.1 points to neutral territory rather than overheating. The European steel association Eurofer expects EU steel consumption to rise 1.3% in 2026, driven by destocked customers beginning to rebuild inventories. With its green steel timetables, narrowing trade gaps and a growing order book in rail and aerospace, Voestalpine looks set to keep the stock’s upward momentum alive — even as the protests outside its factories continue.