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Investing.com - Jefferies raised its price target on Ormat Technologies (NYSE:ORA) to $97.00 from $84.00 on Tuesday, while maintaining a Buy rating on the renewable energy company. The company, currently valued at approximately $5 billion, is trading at a P/E ratio of 40.4, according to InvestingPro data.
The price target increase follows what Jefferies described as a "best of both worlds" scenario for Ormat, as the latest Senate draft legislation shows favorable treatment for both geothermal energy and storage technologies.
Jefferies has increased its storage estimates for Ormat based on better-than-feared outcomes from the Inflation Reduction Act (IRA) and what appears to be a manageable impact from tariffs on the company’s operations.
Despite the optimistic outlook, Jefferies noted it remains below the low end of Ormat’s 2028 guidance due to uncertainty regarding long-term IRA implications and tariff effects on the company’s business.
The new $97 price target includes $81 per share derived from Ormat’s operating portfolio alone, according to Jefferies’ analysis.
In other recent news, Ormat Technologies reported a strong first-quarter 2025 performance with earnings per share (EPS) of $0.66, surpassing the forecast of $0.5963, and revenue reaching $229.8 million, slightly above the anticipated $228.54 million. The company also completed the acquisition of the Blue Mountain geothermal power plant for $88 million, expanding its electricity segment generating portfolio to 1,268MW. Barclays (LON:BARC) analysts upgraded Ormat Technologies’ stock rating from Equalweight to Overweight, citing the increasing demand for geothermal energy as a key factor. Ormat has also entered into a $62 million Hybrid Tax Equity partnership with Morgan Stanley (NYSE:MS) Renewables Inc., involving energy projects like the Lower Rio energy storage facility and the Arrowleaf project. Additionally, Ormat expanded its management team with the appointments of Aron Willis and Daniel Moelk to drive growth in its electricity segment and enhance its Enhanced Geothermal System (EGS) initiatives. These developments reflect Ormat’s strategic initiatives to bolster its geothermal and energy storage capabilities amidst growing demand for renewable energy solutions.
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