After showing strength before the weekend, Siemens Energy shares are now among the biggest losers in Germany’s DAX index as the new trading week begins. The stock’s performance remains complicated from a technical perspective.
Last week, the financial newspaper DER AKTIONÄR examined the ongoing consolidation at Siemens Energy. Although the company, which was spun off from Siemens, remains the strongest performer in the DAX 2024, its momentum has stalled since mid-May. The stock has been stuck in a sideways range, fluctuating between approximately €22.50 and €27.50.
While there have been signs of a breakout since May, each period of strong performance has been followed by a sell-off. The tug-of-war between bulls and bears shows no signs of ending, and both sides still have their arguments. On one hand, the company’s network technology and gas turbines are performing better than expected, but on the other hand, the wind energy business remains a major concern after last year’s billion-euro debacle. Whether the new strategy can successfully stabilize Gamesa, Siemens Energy’s troubled wind power subsidiary, and return it to profitability remains uncertain. Additionally, the entire turbine manufacturing industry continues to struggle with weak margins, a challenge that has yet to be overcome.
The future of Gamesa is likely to play a crucial role in determining whether Siemens Energy’s stock can see significantly higher prices. Although the current pause after the comeback rally of late 2023 and early 2024 is not yet a cause for concern, new catalysts are needed to reignite investor interest. For now, the stock remains a hold, with the battle between bulls and bears potentially leading to continued sideways movement.
