Oil prices push higher amid worries over Russian supply disruptions
Investing.com - UBS initiated coverage on Dongfang Electric Corp (SS:600875) with a Buy rating and a price target of RMB28.90 on Thursday.
The Chinese power equipment manufacturer is positioned as a top-tier OEM serving multiple energy sectors including nuclear, thermal, gas, hydro and renewables, with growing exposure to high-margin maintenance services.
UBS forecasts a 27% earnings per share compound annual growth rate for Dongfang Electric from 2024 to 2029, compared to 11% from 2020 to 2024, driven by three key factors: scaling up of subscription-based maintenance services, a multi-year nuclear equipment upcycle, and potential upside from next-generation technologies such as small nuclear reactors and fusion.
The firm’s earnings per share estimates for 2025-2027 stand 4-29% above consensus, while noting the stock trades at 13 times 2026 estimated price-to-earnings ratio, significantly below the 44 times average for global peers.
UBS highlighted Dongfang Electric as its sector top pick, citing stronger earnings visibility and a more attractive valuation profile compared to industry peers.
This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.