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Ameresco Inc . (NYSE:AMRC) shares received a continued vote of confidence from a Baird equity research firm, which reiterated an Outperform rating and a $32.00 price target. The firm has identified Ameresco as a Bullish Fresh Pick, anticipating that the company's addition of Energy Assets in 2024 and beyond will drive earnings above current and consensus estimates in the medium to long term.
The firm's optimism stems from the expected final completion of a significant project with Southern California Edison in the latter part of the third quarter, which is viewed as a potential near-term catalyst for the company's stock performance.
Ameresco, a leading clean technology integrator specializing in energy efficiency and renewable energy, has faced some hurdles that have affected its stock performance.
However, with the anticipated completion of the Southern California Edison project expected late in the third quarter, Baird foresees a shift in momentum. This project completion is anticipated shortly after the estimated Q3 reporting date of November 15, which could serve as a significant event for the company and its investors.
The firm's reiteration of the Outperform rating and the price target of $32.00 for Ameresco is based on the belief that the company's strategic additions to its energy assets will contribute to a sustainable increase in earnings.
This projection is set against the backdrop of Ameresco's focus on long-term growth in the clean energy sector.
Clean technology integrator Ameresco has been making significant strides in the renewable energy sector. The company has partnered with the City of Somersworth to initiate a substantial solar photovoltaic (PV) installation at the Somersworth Landfill. The project, which is part of a broader commitment to green energy, is expected to produce over 67 million kWh over two decades and offset 2,461 metric tons of CO2 emissions annually.
Ameresco recently reported robust growth in its second quarter, with revenues surging by 34% to $438 million and a record backlog increase of 36% to $4.4 billion. Notably, 155 megawatts of Energy Assets were brought into operation, marking a significant milestone for the company.
However, Ameresco adjusted its fiscal year 2024 EBITDA guidance by 2% due to cost overruns from Southern California Edison projects, as reported by Piper Sandler.
Ameresco has also been involved in other notable projects, including a $33 million energy efficiency enhancement at the U.S. National Archives, a $249 million battery energy storage system in the United Kingdom in collaboration with Envision Energy, and a $21 million streetlight system overhaul in the City of Henderson.
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