Siemens Energy share price rose on Wednesday as investors reacted to its encouraging earnings report, which showed that its momentum was accelerating because of the rising demand for energy. It jumped to €126 in Berlin, paring back some of the losses it made a few months ago, when investors started rotating from similar companies.
Siemens Energy Stock is Rising After Earnings
Siemens Energy is one of the top players in the energy and power sectors globally, where it competes with GE Vernova. Its business has thrived in the past few years as the artificial intelligence industry as led to a surge in power demand globally.
It is against this backdrop that the company published its fourth-quarter earnings report, which showed that its growth continued. This is important because the company was on the verge of collapsing a few years ago.
The revenue jumped by 21.5% in the fourth quarter to €12.8 billion, while its profit continued rising. Most notably, Siemens Gamesa continued its improvement as it recorded its second profitable quarter in a row.
As a result, the company, which received a bailout from the German government a few years ago, continued returning funds to investors. It returned €1.6 billion to shareholders during the quarter, bringing the annual figure to €3.1 billion.
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Siemens Energy’s growth will likely continue in the coming years because of its surging backlog, which stands at over €21.5 billion today. Also, the company believes that there will be a 60% increase in electricity demand, especially from data centers, electric vehicles, and air conditioning.
The company also expects that this demand will lead to higher profit margins. It now expects the net operating margin will jump to as much as 22% in 2030 from the current 18%. It also expects to keep returning funds to its shareholders through dividends and buybacks.
Siemens Energy Share Price Technical Analysis
ENR stock chart | Source: TradingView
The daily chart shows that the ENR stock has been in a downward trend in the past few months, mirroring the performance of other similar companies, including GE Vernova. It formed a descending channel.
The stock has remained above the 50% Fibonacci Retracement level of €116.60. In most cases, rebounds normally happen above the 50% or the 61.8% retracement levels. The stock remains below the 50-day and 200-day Exponential Moving Averages (EMA).
Therefore, the most likely scenario is where it remains under pressure in the near term. A bullish breakout will be confirmed if it moves above the upper side of the descending channel. Such a move will push it to the key resistance level of €150.
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The post Siemens Energy Share Price Outlook After Q4 Earnings Report: Is it a Buy? appeared first in UK on InvestingCube .
