Wednesday, January 19

Solaria takes a run driven by Credit Suisse and RBC

Solaria begins to glimpse some clearing in the storm through which his action has passed this year. After a big entry in 2021, when in January it traded above 31 euros, the value has corrected down to 29 percent and place the price of its share at 16 euros.

This trend has varied upwards in the last quarter, which has today been crowned with a rise that has reached to touch 10 percent, the biggest since April.

This strong comeback has been driven by Credit Suisse y RBC, which have improved the recommendations on the value.

The Swiss firm has Solaria coverage started today with the recommendation of overweight, a target price of 21 euros and a one-year revaluation potential of 34 percent.

While RBC has raised the recommendation of photovoltaics from ‘below the sector’ to ‘same as the sector’, setting its target price at 18 euros, and a potential return of 15 percent.

Figures better than expected

These are not the only reasons that have led investors to bet on value. “Solaria is showing great management capacity in a complex business, since many of the projects in the sector show delays due to the lack of foresight of public administrations to process permits, however, Solaria’s figures present better data than those provided “, he says Antonio Castle, iBroker strategist.

The listed company has obtained results in the first nine months of the year that pleasantly surprised the market.

His net profit soared 50 percent compared to the same period in 2020, up to 37.6 million euros and its turnover increased by 73 percent, until reaching 70.7 million. It also increased its Ebitda, 86 percent, to 70 million euros.

Benefited by the American bond

Another fact that favors the Spanish multinational in the opinion of Sergio Avila, an analyst at IG Markets, is that “utilities have benefited from the fact that the profitability of the American 10-year bond does not rise, despite yesterday’s hawkish tone of the Fed. The market values ​​positively that they left the door open to modify the roadmap if the economy slows down ”.

He believes that “low interest rates are good for growth companies that use debt on a recurring basis, such as those in the electricity sector.”

Is it a good time to invest in value?

After the corrections suffered by the action of photovoltaics so far this year, analysts disagree on whether or not the time has come to invest in it.

This correction may be an opportunity for investors who believe in the development without reversing the energy transition and renewable energies “, says Castelo, for whom” Solaria has great visibility to achieve its planned objectives for 2026 “.

Sergio Ávila is not so optimistic and acknowledges that he would not yet enter the value and I would wait for the share to exceed 18 euros.

“Until the price is confirmed with the break of 18 euros, it is preferable to wait, since it can remain in the lateral range for a long time. From there it will be a good time to get on the trend, “he argues.

For its part, Dario Garcia, an analyst at XTB, considers that the discount offered by the sector since the beginning of the year still looking for solid ground. “The recent recovery in value in the last quarter has developed a consolidation that has to break up to confirm the change in trend, key at 17.6 euros per share.”

He adds that, if this is not confirmed, the retesting of the channel structure support at 15.5 euros per share will be the objective to observe.

Return potential over 20 percent

In general, analysts who follow the value in the main market consensus see potential and give the stock a average target price around 20 euros, although recently there have been revisions that reach 30 euros.

Thus, 52.6 percent of the market consensus consulted by recommends buying the security, 31.6 percent holding and 15.8 percent selling. They place their target price at 19.31 euros and they give you a potential return of 15.7 percent.

Good forecasts

Regarding the behavior of the listed company in 2022, analysts are optimistic. Sergio Ávila believes that it is likely to be a good year for its price, taking into account the forecasts, while Darío García believes that its evolution will depend on the investment in new plants, so that “it will continue to be an uncertainty, at least in the first months of 2022 “.