Renewable Weekly – 24 Sept 2024

Renewable Weekly – 13 Sept 2024

On aggregate, the R&C stocks underperformed (equal weight) the MSCI Nordic by ~1% throughout the reporting season (10 July to today).

Renewable Weekly – 4 Sep 2024

A soft week for renewables: of our basket of 38 stocks, returns were positive for 10 and negative for 28 on the week.

Renewable Weekly – 30 August 2024

A soft week for renewables: of our basket of 38 stocks, returns were positive for 21 and negative for 17 on the week.

Cloudberry (Hold, TP: NOK12.00) - Trading in line with market multiple...

The Q2 report was decent, in our view, with better-than-expected realised power, construction activity progressing on time and budget, and a development agreement with Holmen for 1TWh SE3. Strong development activities have led us to assign a higher value to these activities; thus, we have raised our target price to NOK12 (11). However, as the stock is trading in line with recent asset sales and we struggle to see any near-term triggers, we reiterate our HOLD.

Cloudberry (Hold, TP: NOK11.00) - Worst Odal issues seem behind

Adjusted for accounting gains from the sale of three hydropower plants in Q2, we forecast proportionate EBITDA of NOK5m. Including these gains, we forecast NOK113m, broadly in line with consensus of NOK112m. With the first turbines in Odal recommencing production, we believe most of the issues at the windfarm are behind it. Ramp-up is likely in H2, when we expect Cloudberry to surpass the warranty cap with Siemens Gamesa. We reiterate our HOLD and NOK11 target price.

Renewable Weekly – 19 August 2024

Ørsted (Hold, TP: DKK390.00) - Higher liquidity risk

Strong operational Q2 results were overshadowed by impairments and further US project delays, increasing concerns about the construction risk for offshore wind. With only small onshore farmdowns announced YTD, many more are needed for Ørsted to cover its committed capex. Hence, believe its liquidity situation should be followed closely. We reiterate our HOLD, but have cut our target price to DKK390 (405).

Scatec (Sell, TP: NOK80.00) - Underlying results on the downside

Adjusted for one-offs, the underlying Q2 results fell short of consensus. The key positive was the contingency release for the Kenhardt project, with capex lower than expected, prompting us to raise our 2024e proportionate EBITDA by 4%. We have made no other material estimate changes. We reiterate our SELL and NOK80 target price, reflecting a 12% cost of equity.

Scatec (Sell, TP: NOK80.00) - Tailwinds already priced in

Scatec’s equity story looks brighter, in our view, with interest rate cuts widely expected and execution of its asset-rotation plan to free up capital for growth and corporate debt repayments. We have raised our target price to NOK80 (72) on a lower cost of equity and greater growth contribution. However, we reiterate our SELL, as the tailwinds from lower interest rates and asset sales look well priced into the stock, trading at a ~11% cost of equity and a 2024e proportionate EV/EBITDA of 9.5x.

Renewable Weekly – 8 August 2024

This week we provide a summary of news flow and research from our Renewables & Cleantech equity coverage (and related companies) released during the summer break.

Ørsted (Hold, TP: DKK405.00) - Strong operating quarter expected

We forecast Q2 underlying EBITDA of DKK4.1bn, excluding new partnerships and cancellation fee changes, reflecting normal wind speeds and operations. The DKK1.2bn lower Ocean Wind 1 settlement in the quarter should be a slight relief for liquidity, but we do not expect further large reductions in termination fees. We reiterate our HOLD and DKK405 target price, given the lack of potential near-term catalysts with the stock trading at a 2024e EV/EBITDA of 9.8x.

Cashing in early

Q2 better than expected across all segments. Cash boost from extra fees in Wind Service. P/core NAV 0.85x, lowest in our coverage – BUY.

Bonheur (Buy, TP: NOK275.00) - Solid underlying operations

Bonheur’s strong Q2 was helped by one-off cancellation fees, but also saw solid underlying results. The Cruise segment reported another strong quarter, with occupancy on a par with pre-covid levels. Based on the timing of the cancellation fees and the strong rebound in cruise, we have raised our 2024e EBITDA by 20%, partly offset by a 16% lowered 2025e EBITDA. We reiterate our BUY and NOK275 target price.

Q2 first take: solid across the board

Renewable Weekly – 8 July 2024

Wishing you all a good summer

Smaller adjustments into Q2

Q2e EBITDA of NOK 665m. Estimates up 3-6% on higher power forwards & FX. P/core NAV ~0.84x, lowest in our coverage - BUY.

Bonheur Minor model adjustments

We have updated our estimates ahead of the Q2 results (due at 08:00 CET on 11 July), with new power prices and FX. We do not consider these changes to be material, and we have not changed our BUY recommendation. We reiterate our NOK275 target price.

European breakthrough for Chinese OEM

Cloudberry (Hold, TP: NOK11.00) - Limited effect from hydro transactio...

We consider it positive that Cloudberry is exploiting the strong market for hydropower projects, but consider the net effect of last week’s transactions neutral despite the wide spread in acquisition and sales multiples given the assets’ different profit-sharing mechanisms. We also see potential for greater uncovered losses at Odal, with further ramp-up delays. We reiterate our HOLD, but have raised our target price to NOK11 (9) to reflect the high private market interest for the company’s hydro...