Analyst Note
| Denise Molina, CFA |Siemens posted strong second-quarter results versus our expectations and, similar to many of its peers, increased its full-year guidance on the back of a stronger-than-expected rebound in end-market demand, including in short-cycle orders. Aerospace remains weak. The company is also seeing rising raw materials costs along with prestocking from customers. We have adjusted our forecasts to incorporate the Varian acquisition as well as improved guidance and increase our fair value estimates to EUR 130 per local share from EUR 124 and to $80 per ADR from $75. Our narrow moat rating is intact.