Morningstar

Orsted AS ORSTED

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Stock XCSE Rating as of
DKK 426.90 −15.40 (3.48%)
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As of Delayed Price Closed

Company Report

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European Utilities Rallied in Q3 on Falling Interest Rates; We See Further Upside Potential

Tancrede Fulop

While wholesale power prices stabilized, government bonds’ yields fell on weak economic indicators and lower inflation in the US and Europe. Second-quarter results were boosted by very favorable hydro conditions that led to some guidance upgrades. This goldilocks scenario bolstered a rally in European utilities, enabling them to massively outperform the market and recover much of their earlier underperformance.

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Price vs Fair Value

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ORSTED is trading at a 736% premium.
Price
DKK 426.90
Fair Value
DKK 991.00
Uncertainty
Medium
1-Star Price
DKK 528.00
5-Star Price
DKK 924.00
Economic Moat
Rykkq
Capital Allocation
Cyxdklmrc

Bulls Say, Bears Say

Bulls

The hike of the ceiling price for 2024 UK offshore wind auctions and the extension of capital allowances are positive for the largest offshore wind market in the world, outside of China, where Orsted is the leader. The capital allowances will increase the value creation of Hornsea 3.

Bears

The business plan presented in February 2024 hinges on material divestment including the farm-down of Hornsea 3. Failing to deliver them could force Orsted to resort to a rights issue.

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Trading Information

Previous Close Price
DKK 442.30
Day Range
DKK 426.10–443.40
52-Week Range
DKK 248.00–453.10
Bid/Ask
DKK 427.10 / DKK 427.30
Market Cap
DKK 179.40 Bil
Volume/Avg
320,101 / 478,201

Key Statistics

Price/Earnings (Normalized)
8.10
Price/Sales
3.52
Dividend Yield (Trailing)
0.00%
Dividend Yield (Forward)
0.00%
Total Yield
—

Company Profile

Danish company Orsted was named Dong Energy until the sale of all its oil and gas fields to Ineos in 2017, soon after the May 2016 initial public offering. Orsted is now focused on renewable assets, especially offshore wind farms. It operated 8.9 gigawatts of offshore wind farms at the end of 2023. The United Kingdom is the biggest country of operation, ahead of Germany and Denmark. The group intends to develop its footprint outside Europe with projects in Taiwan and in the US Orsted also operates 4.8 GW of onshore wind and solar assets concentrated in the United States. The company is also involved in more traditional utilities business like conventional power plants and gas supply, but these activities are noncore.
Sector
Utilities
Industry
Utilities - Renewable
Stock Style Box
Large Value
Total Number of Employees
8,411
Website
https://www.orsted.com

Competitors

Valuation

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Metric
ORSTED
IBE
SSE
Price/Earnings (Normalized)
 8.1014.6611.42
Price/Book Value
 3.181.612.22
Price/Sales
 3.521.891.96
Price/Cash Flow
 11.638.597.19
Price/Earnings
ORSTED
IBE
SSE

Financial Strength

Metric
ORSTED
IBE
SSE
Quick Ratio
 1.080.600.76
Current Ratio
 1.480.771.10
Interest Coverage
 −3.354.988.21
Quick Ratio
ORSTED
IBE
SSE

Profitability

Metric
ORSTED
IBE
SSE
Return on Assets (Normalized)
 −1.56%4.79%6.37%
Return on Equity (Normalized)
 −7.23%14.40%20.08%
Return on Invested Capital (Normalized)
 −1.32%7.51%9.01%
Return on Assets
ORSTED
IBE
SSE

Utilities - Renewable Industry Comparables

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Morningstar Rating for Stocks
Capital Allocation
Economic Moat
Market Cap
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