Siemens Enjoying Exceptionally High Revenue Visibility on High Order Backlog

Siemens is a disparate portfolio of leaders in different sectors. The investment case remains complex, with new management unlikely to do any further deconsolidation of the four major businesses: plant management components and software (digital industries), medical equipment (Healthineers), electrical distribution equipment (smart infrastructure), and railway equipment (mobility), each contributing between 10% and 40% of group profits. All of these businesses have strong product portfolios to compete in long-term attractive end markets. Digital industries will benefit from industrial complexes increasingly using productivity-enhancing software and automation hardware. Siemens mobility and smart infrastructure have exposure to "green transformation." Siemens mobility is well placed to benefit from further electrification of European rail and eventually hydrogen trains. Smart infrastructure has a portfolio of products and software, like smart grid software, and connected low- and medium-voltage products, critical in power distribution and building infrastructure upgrades necessary to support growing, but volatile, renewables power supply and electric vehicle charging. However, in terms of profit contribution, digital industries and Healthineers combined generate 80% of the group total.