Maheep Mandloi, an analyst from Mizuho Securities, maintained the Hold rating on Enlight Renewable Energy (ENLT – Research Report). The associated price target remains the same with $19.00.
Maheep Mandloi has given his Hold rating due to a combination of factors that reflect both strengths and risks in Enlight Renewable Energy’s current business situation. While Enlight’s Q1 revenue and adjusted EBITDA surpassed estimates, thanks to robust wind performance balancing out weaker merchant power prices in Spain, the Hold rating suggests that these positives are tempered by broader market uncertainties. Management’s confidence in meeting the 2024 guidance, even with the current low merchant prices, and their progress in project construction amidst industry supply challenges contribute to a stable outlook. Additionally, the company’s partnership with Indian supplier Waaree provides a strategic hedge against potential import tariffs in the U.S., further supporting the Hold rating.
On the other hand, the Hold rating also considers potential growth avenues and market dynamics that could influence Enlight’s future performance. The management’s discussions around significant load growth drivers, such as electrification and datacenter/AI expansion, imply opportunities for Enlight to secure higher Power Purchase Agreement (PPA) prices, which could enhance project returns. However, the Hold rating likely reflects caution regarding the execution of these opportunities and the impact of higher financing costs on acquisition strategies in the European market, despite the potential for acquiring and developing projects at attractive costs. Mandloi’s neutral stance seems to be a balanced assessment of these factors, acknowledging both the company’s solid positioning and the challenges it may face in capitalizing on market opportunities.
ENLT’s price has also changed moderately for the past six months – from $14.710 to $18.090, which is a 22.98% increase.
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Enlight Renewable Energy (ENLT) Company Description:
Enlight Renewable Energy Ltd is a green energy company. It specializes in initiating, developing, financing, constructing, managing and…
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