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Investing.com - JPMorgan upgraded Vestas Wind Systems A/S (CSE:VWS) (OTC:VWDRY) from Neutral to Overweight on Friday, raising its price target to DKK161.00 from DKK126.00.
The upgrade comes after Vestas stock underperformed the SXNP by approximately 85% over the past 18 months due to earnings cuts and multiple compression, both of which JPMorgan now considers largely complete.
JPMorgan cited the latest Bloomberg New Energy Finance outlook, which projects wind installations outside China to grow at a double-digit compound annual growth rate through 2030, with U.S. subsidies remaining in place until mid-2030 following the passage of the Offshore Building Better Bill (OBBB).
The investment bank noted Vestas has made good progress on ramping up and installing its V236 turbine in the offshore segment, suggesting receding risks in that business area.
JPMorgan also highlighted improved price and cost management at Vestas, which it expects will drive higher margins alongside a growing revenue base, creating an attractive risk/reward profile given current trough multiples and sentiment.
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