WOOD: Raises the target price of TERNA Energy to 22.4 euros / share

The financial institution of WOOD & Company revised upwards the target price of the share of TERNA ENERGY.

In a special report for the company – subsidiary of GEK TERNA, the analysts of the agency updated the 12-month price target at 22.4 euros / share, ie 31% higher than current levels and compared to 18 euros which was the previous forecast.

According to WOOD & COMPANY, “TERNA ENERGY continues to show strong profitability and consistent leverage, leaving room in the balance sheet to finance large investments from the company’s portfolio.”

“In our view,” WOOD analysts note, “TERNA ENERGY is strategically positioned to take advantage of the development of the RES industry, as demanding environmental policies require a rapid transition to green energy production and consumption at a pan-European level.”

WOOD refers to the scenarios of investor entry in the listed company, emphasizing that there is room for investors to make profits “.

It relies on this finding in major medium-term development plans, which aim to have an installed RES capacity of more than 6 GW by the end of 2029.

The new goal for RES

WOOD & COMPANY characterizes the aforementioned goal as aggressive.

And he says that TERNA ENERGY has recently updated the medium-term goals in RES projects, adding another 3GW to the equivalent target of 3GW installed capacity for 2025.

In fact, the financial house assumes that at least 2GW RES will be added by the end of 2027, exceeding 3GW by 2026.

Among the projects supporting the above objectives, WOOD describes the Amfilochia pumping and storage project with a capacity of 680MW of energy storage, as well as 870M of onshore wind, including the Kafireas 330MW project, and 580MW of additional solar energy projects in GREECE.

Space for leverage

Regarding the estimates for the course of the net debt, the authors of the report point out that “with 2021 ending in the net debt / EBITDA 3.7x, we see TERNA ENERGIAKI comfortable enough to equip its balance sheet and finance the heavy investment pipeline which is in front of her “.

Earnings estimates

WOOD also describes revenue estimates for 2022. According to analysts, they presuppose the normalization of the electricity trading sector, reducing revenues, but not profitability. For the period 2023-24, WOOD states that the assignment of the project “Kafireas” will increase revenues in 2023 mainly, recording an increase of 25%.

“We expect an increase of EBITDA by 100 million euros by 2024 (compared to EBITDA for 2021), which will result from the commissioning of the Kafireas project and other wind / solar projects. As a result, net profits for 2023 amount to 110 million “, says WOOD.