Thyssenkrupp's Global Pivot: A Split-Screen Strategy Emerges

Thyssenkrupp shares rally on overseas orders and green steel, but face analyst downgrades and European production cuts, highlighting a strategic split.

Thyssenkrupp’s share price is telling two different stories. While the stock recently surged, breaking through a key technical barrier, it simultaneously faces a stark analyst downgrade and operational headwinds in its European heartland. This divergence highlights a company actively navigating a complex split-screen reality: cutting costs and capacity at home while expanding abroad.

The recent rally, which saw shares gain over 8% in a week and climb roughly 30% from a March low of €7.15 to close at €9.26, was fueled by multiple catalysts. A major order from Angola for approximately 1,000 tonnes of the company’s CO?-reduced bluemint® steel provided a concrete boost. The material, destined for a 105-kilometer pipeline project, is produced with increased scrap input to lower its carbon footprint. Concurrently, the group showcased new hydrogen-optimized steels resistant to embrittlement at the Tube 2026 trade fair in Düsseldorf. Technically, the break above the 200-day moving average on April 17 added further momentum.

This optimism runs directly counter to the view from Barclays. Analyst Tom Zhang recently cut his price target on Thyssenkrupp to €9.00, maintaining an "Underweight" rating. He argues that while European steelmakers may have seen a slight sequential improvement in Q1, geopolitical risks from the Middle East are weighing on demand. Zhang has also reduced his profit forecasts for the current and coming fiscal year. The market’s current trading level above this new target underscores a significant disconnect.

Operational moves reveal a strategic reordering. In North America, the Materials Services division is acquiring a majority stake in Mexican service center Aceroteca Trading, a move to strengthen regional supply chains amid a nearshoring trend. This expansion contrasts sharply with the situation in Europe. The company is halting production at its French plant in Isbergues for four months starting in June, a response to a severe import crisis in grain-oriented electrical steel that is crushing margins.

Management is also taking a firm stance on domestic policy. At the Hannover Messe, Thyssenkrupp rejected a proposed one-time €1,000 state relief payment for employees, calling instead for structural solutions to safeguard German industry's competitiveness. The company is prioritizing strict cost control as weak domestic demand in the machinery and plant engineering sector persists, with industry associations warning social contributions could climb toward 50%.

All eyes now turn to May 12, when the group releases its interim report for the first half of the fiscal year. This will provide a clearer picture of the ongoing pressure in the steel segment and the performance of the defense subsidiary Marine Systems, following a recent letter of intent with Spain’s Navantia. Looking further ahead, a potential initial public offering of TK Elevator in the second half of the year looms as a major catalyst. Majority owners are reportedly considering a valuation of up to €25 billion, which could generate billions for Thyssenkrupp’s restructuring. For now, the consensus among analysts expects a full-year loss per share of around €0.72, framing the upcoming report as a critical test for the recent share price recovery.