Power-equipment stocks jump 6% as Nomura says selloff overshot

Power-equipment stocks snapped a two-week slide Thursday after Nomura called the sector's recent drop an overreaction. Hitachi Energy, GE Vernova, and Siemens each rose as much as 6% in early trade, recovering a chunk of the losses that had piled up since late March.

The selloff had hit the group broadly. Shares of grid and electrification suppliers fell 10-15% from recent highs. Profit-taking after a strong run, plus macro jitters around interest rates and project financing, were the usual suspects. Nomura pushed back. In a note to clients, the brokerage said the correction had overshot the fundamentals, citing the sector's order backlogs, long-term demand visibility from grid modernization and renewable integration, and what it called a still-supportive policy backdrop.

Nomura did not name specific price targets in the note. The call was enough to trigger a wave of buying. Hitachi Energy, the power-grid arm of Hitachi Ltd (HTHIY), led the move. GE Vernova, which houses GE's power and renewable assets, and Siemens Energy, the separately listed German group, followed closely.

The readthrough for the broader sector is straightforward. The correction was driven by positioning, not a change in the demand story. Grid equipment orders remain elevated across the board. Transformer lead times are still stretched. Utilities in North America, Europe, and parts of Asia are spending heavily on transmission upgrades. The question was always valuation, not demand. Nomura's view suggests the pullback brought prices back to a level where the long-term thesis still works.

Hitachi Ltd carries an Alpha Score of 65 out of 100, a Moderate reading that reflects the stock's balanced risk-reward after the recent volatility. The score blends momentum, valuation, and earnings revision metrics. For traders, the Nomura call provides a near-term catalyst. The real test will come when the next batch of quarterly orders and backlog data hits the tape.

GE Vernova and Siemens Energy have their own earnings due in the coming weeks. Both are expected to report strong order intake, though margin guidance will be the focus. If the numbers confirm the demand narrative, the bounce could extend. If they disappoint, the correction may resume.

Hitachi Energy closed up 5.8%. GE Vernova added 5.2%. Siemens Energy rose 4.9%. The sector's recovery will depend on whether the fundamentals back up the analyst call.