Terna Energy: Going where the wind blows (stays BUY)
A year after our initiation on the stock and following the 52% price appreciation since then, we reiterate our BUY on Terna Energy (TE) and raise our 12M price target (PT) to EUR 9.2/share, reflecting the expansion of the installed MW capacity in both its Greek and US territory. We believe that, despite the more competitive domestic environment, TE retains its attractive profile, based on its: leading position in the market; stable revenue stream; continuous enrichment of its portfolio; diversification among regions; and attractive valuation. Currently, Terna Energy has installed capacity of 1GW, while we expect it to add c.580MW within the next three years (of which 358MW in the US), justifying a three-year EPS CAGR of 14%, while coming a step closer to its long-term target of 2GW installed capacity. All-in-all, we believe that Terna Energy remains a solid name in our Greek universe, with our new PT offering an attractive 18% of upside potential on a stable cash flow story.Terna Energy is a vertically organized renewable energy sources group based in Greece. Co. is mainly engaged in the energy and construction sector. Co. is active in Wind Energy, as well as Hydroelectric Projects, Solar PV and Integrated Management of Waste to Energy and Biomass Projects. Co. is also engaged in the research for the operation and construction of projects related to other renewable energy sources (RES). Co. maintains a class 6 contractor certificate and its activity in the construction sector relates to the construction of private and public projects as a main contractor or subcontractor or through joint ventures.
WOOD & Company is the leading investment bank in Emerging Europe. Founded in 1991 and head-quartered in Prague, our footprint spans the region and touches investors around the globe.
A pioneer in Emerging Europe, WOOD executed many of the first CEE equity trades and landmark investment banking transactions. Our electronic trading platform was the first in the region, and remains the best. We are continually expanding our relevance and reach in these ever-evolving markets.
Our equity market share reflects our stature: 7% in Warsaw, 20% in Bucharest, 16% in Hungary, 40% in Prague and 5% in Vienna. Our distribution is unparalleled, with the largest salesforce in the region, servicing a uniquely diverse investor base.
We couple local expertise with a truly international perspective. With offices on the ground in the region, and in key financial hubs such as London and Milano, we are never far from our clients and we remain at the forefront of what’s afoot in the CEE emerging and frontier landscape.
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