UBS dramatically reversed its stance on Siemens Energy, upgrading the German power equipment maker from 'sell' to 'buy' and more than quadrupling its price target to €175. The upgrade, which sent shares up over 2%, is driven by an undersupplied gas turbine market and expanding profit margins. UBS projects the company will beat consensus earnings by roughly 9% in fiscal 2030.

The brokerage forecasts annual gas turbine demand will average 88 gigawatts from 2026 to 2035, while industry capacity will reach only 90GW by 2030. This structural shortfall, alongside strong Grid Technologies backlog of €42 billion, supports UBS's view that Siemens Energy's current valuation offers a significant discount to peers like GE Vernova. The analysts see multiple demand drivers beyond data centers.

UBS projects Gas Services EBITA margins will reach 24% by fiscal 2030, exceeding company guidance. The division's order growth is expected to be strong in the first half of fiscal 2026. The Siemens-Gamesa wind business reaching breakeven in fiscal 2026, after a €1.3 billion loss in 2025, could provide an additional catalyst for the stock.