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Investing.com -- Deutsche Bank (ETR:DBKGn) has downgraded Vestas to “hold” from “buy,” citing limited upside potential for 2025 and mounting concerns around the company’s offshore business.
Shares of the Danish wind turbine manufacturer were down 5.3% at 08:17 ET (12:17 GMT).
The bank also slashed its price target on the stock to DKK110 from DKK150. Vestas shares closed at DKK86.16 in the previous session.
Analyst John Kim said the ability for Vestas to outperform expectations next year now appears limited following recent updates on its offshore operations.
While the brokerage had previously flagged upside risk stemming from operational leverage in its onshore segment, that optimism has been tempered by ongoing challenges in offshore, which Deutsche Bank now sees as a drag on performance.
“Teething issues in offshore give us pause,” Kim said, noting that Deutsche Bank’s revised 2025 forecasts now sit at the midpoint of Vestas management’s guidance.
The review has prompted a 1% cut to full-year revenue expectations and a sharper 14% reduction in adjusted EBIT forecasts.
Deutsche Bank’s new group EBIT estimate for 2025 is DKK1.05 billion, around 9% below current consensus.
The bank also flagged weak order momentum in onshore wind, particularly in the Americas, where demand is falling short.
While strong offshore orders lifted the company’s first-quarter intake, Kim pointed out that this mix shift is likely to be margin dilutive in the near term, given lower profitability in offshore compared to onshore.
The combination of seasonal weakness in the first half and limited visibility into U.S. orders further clouds the short-term outlook.
In Deutsche Bank’s view, any material upside for the stock is unlikely until Vestas can stabilize its onshore order flow and show concrete improvements in offshore execution and margins.