Nordex (XTRA:NDX1), Why Is This Fresh Development Drawing Attention?
Nordex (XTRA:NDX1) has attracted fresh investor attention after securing an order from EFG Energy Farming Group for twelve onshore wind turbines in Lower Saxony, with around 82 MW of planned capacity and 20-year service contracts.
See our latest analysis for Nordex.
At a share price of €38.88, Nordex has seen a 1-day share price return of 0.99% and a year to date share price return of 28.49%. The 1-year total shareholder return of 80.33% and 3-year total shareholder return of 243.77% indicate that momentum has been strong despite some recent short term share price weakness.
If this latest German order has you thinking about where the next opportunities in energy infrastructure could come from, it may be worth scanning 39 power grid technology and infrastructure stocks
Nordex is securing fresh projects and growing its service footprint, which points to a solid business position. After such strong recent returns, the key question is whether the current share price still offers value.
Most Popular Nordex Narrative: 18.9% Undervalued
Against a last close of €38.88, the most followed Nordex narrative points to a fair value of €47.93, with that gap driven by detailed forecasts for growth, margins and capital returns discounted at 7.21%.
Service segment growth (revenues up 17% YoY, EBIT margin reached 17.7% in Q2, targeting 18 to 19% in 12 months) and high service contract capture rates (close to 100% in Germany) provide recurring, high-margin revenues, supporting sustained gross margin and EBITDA improvement.
Want to see what kind of revenue profile has to sit behind that margin story. Or how earnings, discount rate and future valuation multiples are woven together. The full narrative sets out the exact growth path Nordex would need to travel for today’s share price to close the gap to that €47.93 fair value estimate.
Result: Fair Value of €47.93 (UNDERVALUED)
Have a read of the narrative in full and understand what's behind the forecasts.
However, this Nordex narrative still depends on European policy support staying firm and on warranty and legacy cost outflows easing, rather than weighing on margins for longer.
Find out about the key risks to this Nordex narrative.
Next Steps
If this Nordex story sounds promising, use the momentum to review the underlying data now and test whether the optimism holds up for you by examining the 4 key rewards.
Looking for more investment ideas beyond Nordex?
If Nordex has sharpened your interest in what is possible, do not stop here. The next step is lining up your broader watchlist with care.
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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
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