Wind turbine manufacturer and servicer Vestas (VWS.DK) has plunged nearly 12%. The company is struggling with high debt levels, falling profitability. Now investors are worried that a Trump-led America will move away from betting on wind turbines, generously subsidized by the previously ruling Democrats. Shares of rival Ørsted (ORST.DK) are also losing ground on the wave of these fears.
- Vestas warned yesterday that its profit margin for this year is likely to be at the lower end of its forecast range due to high costs. The company's shares have fallen nearly 50% since the start of the year, in the face of inflation, supply chain and market competition, the future size and scale of government support of which is difficult to estimate. JPMorgan believes that the outcome of the U.S. election for the company will be more important than disappointing quarterly results.
- Trump has promised that if he becomes president, on his first day in office he will scrap offshore wind projects via executive order, citing environmental damage. However, Vestas maintains that it is ready to cooperate with any president, even Trump.
- Operating profit came in at 235 million euros against 352 million euros forecast. The company expects full-year operating profit margins at the lower end of the 4-5% range and expects revenues of 16.5 billion to 17.5 billion euros. The services business is expected to generate an operating profit of €450 million versus a previous estimate of €500 million.
Vestas shares (VWS.DK), D1 interval
Source: xStation5
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