Vestas Wind Systems A/S is a top stock pick among wind farm equipment manufacturers for analysts at investment bank Citigroup.
Capital goods analyst Martin Wilkie said in a research note on Friday that the investment bank reiterates its confidence in Danish wind turbine maker Vestas ahead of the climate negotiations in Dubai next week.
Investors who invested money in Vestas’s stock in 2018 will have seen their investment increase by 75%, which now trade at about 172.44 Danish krone a piece; though despite these long-term gains, the manufacturer’s share price has been extremely lumpy and lost footing this year.
“Ahead of the COP28 climate conference next week, we expect ambitions to be high – the US, EU, and China all back a tripling of renewable energy capacity by 2030 – but we expect the reality to be more sobering,” Wilkie said.
The Citi analyst explained that, with even more ambitious national targets due in 2025, investors are more focused on “the practicalities of even achieving existing targets, including supply chain, permitting, financing, market structure, and now the risk of US IRA repeal”.
“We think parallel catalysts (EU permitting, US tax guidance) can drive expectations from low levels, and re-iterate Vestas as our top pick amongst wind OEMs,” Wilkie added.