The market points to Iberdrola as the clear winner of the auctions held in Scotland after winning 7 GW of offshore wind energy: two large-scale floating projects in collaboration with Shell (5GW) and a fixed project alone (2GW). Several analyst firms have already given their assessments of the positive impact of the company’s latest award.
Bestinver Securities, which highlights its leading position in the development of offshore wind energy worldwide, estimates a compound annual growth rate (CAGR) of 7.5% in gross operating profit (Ebitda) until 2025.
Bestinver analysts, who advise investors to add the electricity company’s shares to their portfolios, estimate a value of 12 billion euros for the offshore operations of the company chaired by Ignacio Galán (9% of the company’s value). The offshore business generated an Ebitda of $683 million (€600 million) in 2020 and by 2023 Iberdrola expects to have 18GW of offshore wind energy in operation in different markets.
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Iberdrola wins 7,000 MW in UK’s largest offshore wind auction
Bernstein’s experts, who highlight the company’s ability to generate sites at minimal cost, see “Iberdrola’s strong performance as a positive sign of a possible spin-off in offshore wind,” they note in their latest report.
In general, the investment bank highlights the good performance of established companies in the energy and electricity sector in the United Kingdom.
According to the research firm, among utilities, in addition to Iberdrola, also SSE, EDPR, Engie, Vattenfall, ENBW, Orsted, Northland Power and Falck Renewables have benefited from the auction.
“Iberdrola’s global leadership position in all renewable technologies.”
Banco Sabadell experts have also highlighted the positive news in their latest report. According to the analysis, it highlights “Iberdrola’s global leadership position in all renewable technologies”.
Goldman Sachs also points to Iberdrola as the “clear winner”, with a 25% share of the auction. Conversely, on the other side of the coin, the investment bank says the result may be disappointing for Orsted (with only 1.5% market share) and, to a much lesser degree given the higher share obtained in the 2021 Crown Estate (England) seabed auction, RWE (no awards).
According to FactSet’s market consensus data, Iberdrola shares receive a buy recommendation. Fourteen of the 20 analyst firms that follow its stock market performance believe that it is a good time to buy. The remaining 6 remain cautious and recommend holding.
According to the same firms, the target price for the electricity company’s shares is $13.43 (€11.79) per share. $11.96 (€10.05) at the close of the last market session, we are talking about a potential of more than 17% in the short term, i.e. over the next 12 months.
In its last day on the stock market, after learning of the auction awards in Scotland, Iberdrola rose by just over 1%, compared to 0.36% for the Ibex 35. With the latest movements, in the weeks elapsed in the new financial year, the company has lost nearly 3.5% on the stock market.
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First published in elEconomista.es, a third-party contributor translated and adapted the article from the original. In case of discrepancy, the original will prevail.
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