Vestas is facing headwinds on several sides and thus risks exiting 2022 with a deficit on the bottom line, deems Senior Equity Analyst Jacob Pedersen at Danish bank Sydbank while noting attractive growth perspectives later on, with the possibility of clear improvements from 2023.

”There are many current indications that our present net result forecast of EUR 293.9m this year is too optimistic, and that Vestas could come substantially closer to a result of zero or even end in deficit for 2022,” Pedersen writes in a note.

He counts on the war in Ukraine impacting Vestas annual report this year, adding that the OEM likely impair Russian asset values.

”Moreover, delays/cancellation of projects in Ukraine and Russia will cost growth and profitability. Persistently high transport and material costs will also be detrimental,” Pedersen highlights.

Based on Nordex’ annual report for 2021 published Tuesday, the analyst notes that not all wind turbine makers are equally eager to hike prices.

”The financial statement reveals that Nordex has not raised average sale prices to the same degree as Vestas in the fourth quarter,” Pedersen writes and points out that financial reports don’t show an accurate picture of underlying price development.

Whilst Vestas has raised prices by roughly 20 percent, Nordex increased its prices by only 6 percent during the quarter.

”That explains how Nordex won market shares in Q4 of 2021, when company order intake measured in megawatts was actually higher than Vestas’ – but with the value of the same being marginally lower,” Pedersen highlights.

Sydbank maintains its ’buy’ recommendation of Vestas stock, saying that ”attractive growth perspectives and sales-price increases will clear the path for improvements already from 2023.”

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