Thyssenkrupp's Two-Speed Turnaround: Defence Order Book Swells as Analysts Rush to Upgrade

Thyssenkrupp shares gain 23% in 30 days as defence backlog hits €20.1B, but Nucera order intake slumps, prompting mixed analyst targets.

The investment case for Thyssenkrupp is increasingly being written in two very different registers. On one side sits the defence business, where the order book is bulging to historic levels, and on the other, the green hydrogen arm, where the pipeline is visibly thinning. Yet the shares are climbing all the same, propelled by a wave of analyst upgrades that has gathered pace over the past fortnight.

The most striking data point came from the marine division. Thyssenkrupp Marine Systems reported an order backlog of €20.1 billion after nine months of the current fiscal year, a figure that would swell beyond €25 billion if an anticipated frigate programme is factored in. The unit, which was floated on the stock exchange in October 2025, remains majority-owned by the parent group, which holds 51 percent. A twelve-month lock-up period on that stake expires in October 2026, a date investors are already circling as it could theoretically open the door to changes in the ownership structure.

The analyst community, meanwhile, has been busy sharpening its pencils. Bank of America lifted its price target to €22 from €19 on 20 August, citing improving profitability from the ongoing restructuring and the prospect of a partial separation of the steel business. Citigroup followed a day later with an upgrade to €20, pointing to a China-driven tailwind for commodity stocks. Both houses reaffirmed their buy recommendations.

The most notable shift came from DZ Bank, which on 21 August moved its rating from "Hold" to "Buy" and raised its fair value from €11 to €16. The flurry of revisions is all the more remarkable for the diversity of justifications attached to it — operational progress, a possible corporate split, and external raw-material dynamics from China all feature. That several institutions moved almost simultaneously suggests the August quarterly figures and the raised guidance served as a wake-up call for the entire analyst community.

Not everyone is singing from the same hymn sheet, however. JPMorgan nudged its target up to €15 from €12.80 on 14 August but kept a "Neutral" stance, a markedly more cautious tone than its US peers. Deutsche Bank confirmed its existing buy recommendation on the same day without altering its price objective. The resulting spread — from €15 at JPMorgan to €22 at Bank of America — illustrates just how far apart the houses remain on the likely success of the conglomerate's overhaul.

On the operational front, the steel division delivered a tangible milestone this week. Thyssenkrupp Steel granted final acceptance to partner Primetals Technologies for the new continuous caster No. 4 at the Duisburg site. The facility is designed for the production of high-margin premium steel grades, marking a concrete step in the shift towards higher-value products. In parallel, the group is pushing ahead with the Carbon2Chem research project, expanding the hydrogen infrastructure for subsidiary Thyssenkrupp Nucera in Duisburg and planning a facility for sustainable aviation fuel. These investments signal that the company is holding its nerve on long-term transformation projects despite the strained conditions in its core business.

The weak spot remains Nucera. Order intake at the electrolyser specialist came in at just €81 million in the third quarter, prompting the company to cut the upper end of its full-year order intake guidance for the period ending September 2026 from €850 million to €670 million. Revenue expectations for the green hydrogen segment were also trimmed to a range of €100 million to €130 million. Berenberg responded on 25 August by lowering its revenue and earnings forecasts for the 2026 to 2028 fiscal years, while keeping a "Hold" rating on the stock.

The share price has absorbed the mixed news flow with notable resilience. The stock closed Friday at €14.67, down 1.2 percent on the day, but that did little to dent a weekly gain of 9.2 percent. Over the past 30 days, the advance totals 23 percent, leaving the shares just 3.4 percent below their 52-week high of €15.18, reached in late August.

The picture that emerges is of a group pushing its transformation forward on multiple fronts — a well-stocked defence order book, tangible technical progress in steel, and continued investment in hydrogen and fuel projects — even as individual segments such as Nucera stumble. For investors, the October date around the TKMS lock-up expiry remains the key marker for how the corporate structure might evolve next.