Thyssenkrupp's Fate Hinges on a Deal and a Downgrade

Thyssenkrupp shares face a pivotal moment with a potential €4B cash injection from a TK Elevator sale, but Barclays cuts price target amid steel sector woes and antitrust hurdles.

Thyssenkrupp shares are caught between a potential multi-billion euro windfall and a starkly pessimistic view from the analyst community. The stock, trading at €8.70, is down roughly 10% year-to-date and sits about 34% below its 52-week high, reflecting the deep uncertainty surrounding the German industrial conglomerate’s future.

A significant source of that uncertainty could soon be resolved. Finnish elevator giant Kone is in advanced talks with private equity firms Advent and Cinven to acquire TK Elevator, the business Thyssenkrupp sold in 2020 for €17.2 billion. The owners are targeting a valuation of up to €25 billion, including debt. With Thyssenkrupp retaining a 16.2% stake, a deal at that price would inject approximately €4 billion into the company's coffers—cash that is critically needed to fund its ongoing restructuring. A final agreement is expected by the end of April.

However, the path to a deal is fraught with obstacles. A merger between Kone and TK Elevator would create the world's largest elevator manufacturer, raising serious antitrust concerns. Rival Schindler has already signaled it will challenge any potential transaction with regulators. CEO Paolo Compagna told Reuters such a fusion would massively shake up the industry. In a parallel move, Advent and Cinven continue to prepare for a potential IPO of TK Elevator, a classic pressure tactic in the negotiations.

The urgent need for liquidity is underscored by Thyssenkrupp's struggling core operations. In the second quarter of the current fiscal year, revenue came in at €8.52 billion, about one billion euros below analyst expectations. Separate talks with Jindal Steel International regarding an investment in the Steel Europe division have stalled over disagreements on pension liabilities and investment commitments.

Amid this backdrop, Barclays delivered a sobering assessment on Friday. Analyst Tom Zhang cut the bank's price target on Thyssenkrupp to €9.00 from €9.50, maintaining an "Underweight" rating. The new target is a mere 3% above the recent share price of €8.74. Zhang cited lowered earnings-per-share (EPS) forecasts for both the current and coming fiscal years. This stance places Barclays at the bearish extreme of analyst sentiment, with the consensus price target standing notably higher at €10.78.

Barclays' revision points to a persistently challenging environment for Thyssenkrupp's steel business. While European steel industry figures showed a slight sequential improvement in the first quarter of 2026, the bank sees no signs of a genuine recovery. Geopolitical risks in the Middle East, volatile raw material prices, and ongoing supply chain issues continue to cloud the demand outlook.

The coming weeks present several critical deadlines for the company. On April 29, revised bids are due for a major Canadian submarine contract, where Thyssenkrupp's marine unit TKMS is competing against Hanwha Ocean. Ottawa's decision on a preferred supplier is expected between May and the end of June. Thyssenkrupp will also release its half-year report on May 12. Furthermore, EU safeguard tariffs on steel imports are set to rise to 50% on July 1, a development that could provide some relief to its domestic steel operations.

For now, the stock remains below all key moving averages. A sustained shift in momentum likely depends on the TK Elevator deal taking concrete shape, providing the capital necessary to execute its corporate overhaul. Should other analysts follow Barclays in trimming their earnings estimates, additional pressure on the share price is almost certain.