GE Vernova (GEV.US) earnings drag down Siemens Energy (SMEGF.US); JPMorgan steps in to support, calling the decline baseless!

According to Zhitong Finance APP, in Wednesday’s trading, Siemens Energy (SMEGF.US) followed its peer GE Vernova (GEV.US) in declining, with its stock price dropping more than 5%. Gas turbine manufacturer GE Vernova released its Q2 earnings report that day, missing market expectations on both core profit and its full-year revenue guidance. In response, JPMorgan issued a research report expressing support.

Data released by GE Vernova on July 23 (EDT) showed that Q2 revenue grew 22% year-on-year to $11.1 billion, and the company raised its full-year revenue and free cash flow guidance, projecting revenue of $45.5 billion to $46.5 billion in 2026. However, Q2 adjusted EPS was $2.47, below the market expectation of $3.01.

After the earnings release, GE Vernova’s stock price tumbled and closed down more than 8%. Siemens Energy also declined, closing down 4.8%.

JPMorgan analysts noted that investors in Siemens Energy are concerned about the binding nature of its announced orders following GE Vernova’s results, but the sharp drop in Siemens Energy’s share price is not justified.

The analysts believe that it is unfounded to map GE Vernova’s performance directly onto Siemens Energy, since the latter is more focused on its confirmed orders. Furthermore, GE Vernova’s capacity expansion has raised concerns in the market about a supply glut, but JPMorgan still maintains that demand will continue to exceed supply through at least 2028.

JPMorgan stated in the research report: “Clearly, demand remains very strong, while at least for now, supply is still seriously lagging behind demand.”

Siemens Energy is scheduled to release its Q3 earnings on August 5, while the world’s largest wind turbine manufacturer Vestas (VWDRY.US) and Ørsted (DNNGY.US) will report their results in the following week.