Key Morningstar Metrics for Siemens Energy
- Fair Value Estimate: €132
- Morningstar Rating: ★★
- Morningstar Economic Moat Rating: Narrow
- Morningstar Uncertainty Rating: High
Siemens Energy ENR‘s fiscal first-quarter revenue grew 13% year on year. Orders increased 34% at a constant exchange rate to an all-time high of €17.6 billion, implying a 1.82 book/bill ratio, up from 1.53 last year. Net profit tripled to €0.75 billion. The group confirmed fiscal 2026 guidance.
Why it matters: Order growth was primarily driven by the gas services business. With 102 gas turbines representing 13 gigawatts of capacity, order intake reached an all-time high, notably supported by data center-related demand. Data centers account for around 28% of total committed volume for the business.
- First-quarter revenue growth of 12.8% is at the high end of the 11%-13% guidance for fiscal 2026, albeit slightly below our 13.2% estimate. Operating margin of 12% is ahead of the 9%-11% guidance and our 11.4% estimate.
- This strong set of results confirms that Siemens Energy is one of the global winners of electrification and data centers’ thirst for electricity.
The bottom line: We confirm our earnings estimates and €132 fair value estimate for narrow-moat Siemens Energy. The shares appear overvalued after the strong rally year to date, supported by the massive amount of investment announced by hyperscalers for 2026.
Key stats: Data centers also boosted the grid technology business, which achieved the highest organic revenue growth in the group at 27%, ahead of the 19%-21% growth guidance for the full year.
- Free cash flow doubled year on year to €2.8 billion in the wake of higher profits, reservation fee agreements from soaring orders, and a slow ramp-up of investments, which accounted for only 3.6% of revenue versus 5% guided for the full year.
- Siemens’ Gamesa orders tumbled 34%, as the year-ago quarter was boosted by a big offshore wind order. Operating losses shrank from nearly €0.4 billion to close to breakeven, in line with full-year guidance.
