Goldman Sachs Maintains Buy Recommendation for Siemens Energy Amid Diverse Global Operations

Goldman Sachs maintains a Buy rating for Siemens Energy AG, emphasizing the company's focus on electricity and gas production and distribution, along with related consulting and maintenance services. Siemens Energy's operations span the generation, transmission, and distribution of electricity and gas (71.2%), and the design, construction, operation, and maintenance of renewable energy facilities (28.8%). Sales are distributed across various geographies, with the United States and Europe constituting significant markets.

Goldman Sachs, a leading global investment bank, has maintained its Buy rating for Siemens Energy AG (SIE.DE), underscoring the company's strong focus on high-margin businesses in electricity and gas production and distribution, as well as related consulting and maintenance services [1]. With operations spanning the generation, transmission, and distribution of electricity and gas (71.2%) and the design, construction, operation, and maintenance of renewable energy facilities (28.8%), Siemens Energy is well-positioned to capitalize on secular trends like digitalization and decarbonization [1].

Net sales for Siemens Energy are geographically distributed, with significant markets in Europe and the United States. In 2020, Europe/CIS/Middle East/Africa accounted for 39.3% of net sales, while the United States contributed 18.5% [1]. These figures underscore the importance of the European and American markets for Siemens Energy's growth prospects.

In addition to its operational strengths, Siemens Energy has also recently received a credit rating upgrade from S&P Global Ratings. The rating agency upgraded Siemens AG's long-term issuer rating to AA- from A+, citing the company's successful transformation of its industrial portfolio and its focus on high-margin businesses that benefit from secular trends [2].

Ralf P. Thomas, Chief Financial Officer of Siemens AG, expressed his satisfaction with the upgrade, stating, "The upgrade in our rating underlines once again Siemens AG's financial strength. We are pleased that S&P Global Ratings has given fitting recognition to our outstanding cash performance and strong operating results. Our AA- rating puts us well ahead of our peers and is a pleasant privilege" [2].

With a strong focus on high-margin businesses and a favorable market outlook, Goldman Sachs remains bullish on Siemens Energy AG, making it an attractive investment opportunity for investors seeking exposure to the electricity and gas production and distribution sector.

[1] MarketScreener. Siemens Energy AG. Retrieved March 29, 2023, from https://www.marketscreener.com/quote/stock/SIEMENS-ENERGY-AG-113013151/news/SIEMENS-ENERGY-Goldman-Sachs-maintains-a-Buy-rating-47034899/
[2] Siemens. Press Release. S&P Global Ratings Upgrades Siemens AG's Credit Rating to AA-. Retrieved March 29, 2023, from https://press.siemens.com/global/en/pressrelease/sp-global-ratings-upgrades-siemens-ags-credit-rating-aa