DESJARDINS SECURITIES Northland Power (NPI, $21.40): good upside potential given large offshore wind projects
The Toronto-based clean and green energy infrastructure operator provided investors with an update on its offshore wind operations last Friday. The focus was on its ability to execute construction and optimization. of potential projects in this sector, explains Brent Stadler, analyst at Desjardins Securities.
The analyst found that completing projects on time is the key to achieving cost savings. Thus, it intends to closely monitor the updates to assess whether the Hai Long project (in Taiwan) will be on track to be functional in mid-2025 and whether the Baltic Bay project (in Poland) will be completed in 2026.
Management has lowered its 2025 earnings before interest, taxes, depreciation and amortization (EBITDA) guidance somewhat to a range of $1.6 B to $1.8 B from $1.7 B to $1.9 B. that was previously anticipated. But this figure is conservative. This is a compound annual EBITDA growth rate of 7% to 10%, notes the analyst.
Over the coming years, Northland Power will focus its attention primarily on onshore renewable energy projects in Canada, including solar in Alberta and other renewables in Ontario, as well as its offshore projects in the United Kingdom and Korea. from South.
Analyst has a Buy recommendation for the company with a target price of $33.00