Siemens Healthineers Reports Strong Performance

Shares in Siemens (ETR:SIEGn) Healthineers surged over 7% on Wednesday after the company met its full-year revenue and profit growth targets. The Imaging division and the U.S.-based cancer treatment unit, Varian, delivered strong performances in the fourth quarter, offsetting weaker results in China.

The German medtech company reported a comparable annual revenue growth of 4.7% for the fiscal year ending September 30, slightly below the analysts' consensus forecast of 4.8% from Vara Research, but within Siemens Healthineers' projected range of 4.5%-6.5%. Adjusted EBIT reached €3.5 billion ($3.77 billion), matching analysts' expectations.

In China, revenue dropped by a mid-single-digit percentage in the fourth quarter due to delayed customer orders. However, Siemens Healthineers noted strong revenue growth in the Americas. CFO Jochen Schmitz expects China revenue to decline mid-single-digit to high-single-digit percentage points in the first half of fiscal year 2025, stabilizing in the second half.

CEO Bernd Montag reassured that China remains a significant market in the medium to long term. Looking forward, Siemens Healthineers anticipates comparable revenue growth of 5%-6% in 2025, with adjusted basic earnings per share projected between €2.35 and €2.50. Although this earnings guidance falls slightly below the consensus estimate of €2.53, Jefferies analysts believe that an initially cautious forecast could allow for upgrades when China stabilizes. They also noted that shares have been flat year-to-date, making the valuation attractive.