Update shared on 05 Dec 2025
Fair value Decreased 0.32%Analysts have slightly trimmed their price target on Siemens, lowering fair value by about €0.80 to roughly €253. This reflects comparatively weaker expected sales and profit growth from the company’s lower margin electrification and mobility businesses relative to its industrial automation segment.
Analyst Commentary
Analyst sentiment around Siemens has turned more cautious as the margin gap between its core industrial automation activities and the electrification and mobility divisions becomes more apparent. The revised price target embeds a view that future earnings growth will be solid but no longer clearly outpace key European industrial peers.
With the stock now closer to what analysts see as fair value, recent research highlights both residual strengths in Siemens' portfolio and emerging constraints on upside from execution and mix.
Bearish Takeaways
- Bearish analysts see the structurally lower operating margins in electrification and mobility as a drag on group profitability, limiting the scope for further multiple expansion.
- Weaker expected sales and profit growth versus peers in the coming year leads these analysts to argue that Siemens now warrants a more neutral rating relative to the wider industrial complex.
- There is concern that capital and management attention required to support lower margin segments may dilute focus on higher return industrial automation initiatives, pressuring return on invested capital.
- Valuation is viewed as fairly full given the current growth and margin outlook, with limited near term catalysts identified to drive a sustained rerating above the revised fair value estimate.
What's in the News
- Siemens and GE Vernova are reportedly in talks to supply gas turbines for a $7 billion project to rebuild Syria's war damaged power sector, potentially positioning Siemens for a large, politically sensitive infrastructure contract (Reuters).
- Siemens and digital assets market maker B2C2 have begun using JPMorgan's Kinexys Digital Payments, a blockchain based FX platform that enables 24/7 cross border transactions with near instant settlement in major currencies, highlighting Siemens' push into next generation treasury and payments infrastructure (Bloomberg).
- Siemens is studying a possible spinoff of a large part of its majority stake in Siemens Healthineers, with a distribution of shares to investors under consideration, which could reshape the group's portfolio and capital allocation if pursued (Bloomberg).
Valuation Changes
- Fair Value, trimmed slightly from approximately €253.81 to €253.00, reflecting a marginally less optimistic outlook for the shares.
- Discount Rate, reduced modestly from about 5.84 percent to 5.84 percent, indicating a slightly lower assumed cost of capital in the valuation model.
- Revenue Growth, raised slightly from around 6.11 percent to 6.28 percent, signaling a small upward revision to medium term top line expectations.
- Net Profit Margin, increased moderately from roughly 10.75 percent to 11.20 percent, implying improved profitability assumptions over the forecast period.
- Future P/E, lowered from about 22.9x to 21.8x, suggesting a somewhat more conservative multiple applied to Siemens' forward earnings.
Disclaimer
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