Thyssenkrupp's Two-Pronged Turnaround Story Gains Traction With Investors

Thyssenkrupp stock jumps 6% to €13.44 as earnings guidance rises, green steel financing nears breakthrough, and DZ Bank upgrades to Buy with €16 target.

The market's verdict on Thyssenkrupp was unambiguous on Friday, with shares jumping 6.0 percent to €13.44 — a move that lifted the stock's year-to-date gain to 44 percent and pushed the Essen-based conglomerate's market capitalization to roughly €7.88 billion. Behind the surge lay a rare convergence of positive catalysts: an upgraded earnings outlook, progress on a landmark green steel project, and fresh analyst endorsement from the DZ Bank, which raised its rating to "Buy" with a fair value of €16.

The DZ Bank upgrade, which arrived alongside the share price jump, underscores how influential analyst sentiment has become in shaping Thyssenkrupp's trajectory. The new price target sits comfortably above the stock's current level and well beyond its 52-week low from March, though the shares still trade beneath their 52-week high of €14.05.

Green Steel Financing Nears a Breakthrough

At the heart of the positive momentum is the roughly €3 billion Duisburg project, designed to transition the company's steel production toward climate-friendlier methods. According to Reuters, Thyssenkrupp is in advanced discussions to adjust the funding and subsidy structure for the ambitious undertaking — a sign that the financing puzzle may finally be falling into place.

The company's decision to raise the lower bound of its adjusted EBIT guidance for fiscal 2025/26 to €600 million added further weight to the bullish narrative. Management pointed to stronger contributions from the steel, marine, and materials trading divisions as key drivers behind the improved outlook.

Quarterly Numbers Paint a Brighter Picture

The third-quarter results released the same day lent concrete support to the more optimistic tone. Revenue climbed 8 percent year-on-year to €8.8 billion, while adjusted EBIT reached €183 million and net profit came in at €34 million. For the first nine months of the fiscal year, cumulative revenue stood at €24.4 billion with adjusted EBIT of €591 million.

Management confirmed the revised EBIT range of €600 million to €900 million for the full year and narrowed its net income forecast to a loss of between €700 million and €400 million. Free cash flow before acquisitions is still expected to land in negative territory, between €600 million and €300 million.

The quarterly presentation highlighted positive trends across Materials Services, Steel Europe, and Marine Systems — evidence, the company argues, of meaningful progress in its strategic repositioning.

Marine Division Emerges as a Reliable Growth Engine

The standout performer within the group is undoubtedly TKMS, the naval systems subsidiary, which has amassed an order backlog exceeding €25 billion, including €6.3 billion alone from frigate contracts. In the first nine months of the fiscal year, the division's revenue expanded 19 percent to €1.89 billion, while operating profit climbed 13 percent to €110 million.

The bulging order book reflects sustained European demand for naval armaments, placing Thyssenkrupp alongside Rheinmetall — whose own order intake has surpassed the €100 billion mark — as a primary beneficiary of the continent's defense spending surge. A potential submarine deal with Greece, which the company says it is hopeful of securing, could swell the backlog further.

This diversification matters for the broader investment case: Thyssenkrupp is no longer hostage to the cyclical fortunes of its struggling steel division. While Steel Europe has historically introduced volatility into the group's earnings, TKMS now delivers dependable growth rates and stable margins.

Analysts Split on Conviction Levels

The post-results analyst response has been broadly supportive, though conviction varies. Deutsche Bank maintained its "Buy" rating with a €16.00 price target, while Jefferies also reaffirmed "Buy" with a more conservative €13.00 target. JPMorgan, meanwhile, lifted its price objective from €12.80 to €15.00 but held firm on a neutral stance — a reflection of the differing degrees of confidence in the stock's upside potential.

A Lingering Concern in the Hydrogen Unit

Not every piece of news from the group's orbit was positive. Thyssenkrupp Nucera, the hydrogen subsidiary, cut its fiscal 2026 guidance after abandoning mass production of its SOEC stacks, now projecting an EBIT loss of between €105 million and €75 million. The setback, however, is confined to the hydrogen business and does not directly impact the parent company's operations.

For investors, the central takeaway from this reporting season appears to be the combination of a firmer earnings trajectory, tangible progress on the Duisburg financing front, and a defense business that keeps compounding its strategic value. Whether the DZ Bank's €16 fair value proves prescient may depend on how quickly the green steel financing structure comes together — and whether TKMS can convert its record pipeline into further contract wins.