Energy Morning - 19 May 2025

Hornsea 4 cancellation adds to uncertainty

Ørsted today announced it is cancelling development of the 2.4GW Hornsea 4 project off the UK due to increased supply chain costs, higher interest rates, and greater construction and operational risk (FID was expected later in 2025). The cancellation adds to uncertainty for the offshore wind services industry and overall project profitability within offshore wind. No installation contracts for Hornsea 4 had been disclosed yet, but with Cadeler responsible for foundations and half the turbines on Hornsea 3 (2026–2027e execution), and having a long-term frame agreement with Ørsted for a foundati...

Takeaways from WindEurope

At the WindEurope event in Copenhagen, we met with companies representing approximately 75% of the global offshore wind installation fleet, gaining insights that support a constructive outlook for the sector. Addressing recent investor concerns related to market growth, the industry has already reflected and anticipated recent downward adjustments in third-party forecasts. With respect to a slowdown ahead in the US market, a second investor concern lately, near-term vessel demand could surprise to the upside, while the industry participants were not concerned that vessels currently in the US m...

Airthings (No_rec, TP: NOK) - Recommendation and target price withdrawn

As a result of DNB Markets acting as financial advisor in conjunction with the company’s announcement (link) of a strategic review prompted by a non-binding letter of intent from Firda AS to explore a potential sale of its business segment assets, we have withdrawn our target price and recommendation.

SpareBank 1 Helgeland (Hold, TP: NOK167.00) - Softer margin, but lower costs

Helped by still-solid core revenues, cost reduction YOY and moderate loan losses, HELG reported a Q1 ROE of 12.3%, despite some margin pressure. With solid earnings generation, the bank increased its CET1 ratio by ~20bp to 18.0% and still guides for a 0.8%-point benefit from the implementation of Basel IV, boding well for meaningful distributions. We have lowered our 2026–2027e EPS by 0–1%, That said, we reiterate our target price of NOK167. With the stock trading at a 2026e P/E of ~12.4x, we continue to find the valuation fair and reiterate our HOLD.

Smartoptics (Buy, TP: NOK27.00) - We remain optimistic

Smartoptics’ Q1 results marked a slower start to the year than we forecast, primarily owing to weaker sales in Devices, which seems to be back to near-term tariff-induced uncertainty. On the flip side, we understand the slowdown seen towards end-Q1 has already caught up again in order inflow, and thus we remain upbeat for the quarters ahead. Following an estimate reduction, we have lowered our target price to NOK27 (30) but reiterate our BUY.