Analyst Jon Windham from UBS maintained a Buy rating on Ormat Techno and increased the price target to $148.00 from $135.00.
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Jon Windham has given his Buy rating due to a combination of factors tied to Ormat Technologies’ strategic positioning in the evolving geothermal landscape. The expected IPO of Fervo Energy, a prominent Enhanced Geothermal Systems (EGS) player, highlights rising investor interest in geothermal power and underscores the sector’s long-term growth potential. Windham views this development as supportive for Ormat, as stronger electricity demand is underpinning higher power purchase agreement pricing and increasing market attention on Ormat’s asset base, which could help unlock a higher valuation despite the emergence of new competitors.
In addition, Ormat’s $25 million investment in Sage Geosystems broadens its EGS capabilities through exposure to Sage’s proprietary pressure geothermal technology, which can create engineered underground reservoirs and potentially expand viable geothermal resources beyond conventional sites. The planned pilot of Sage’s technology at an existing Ormat plant, coupled with Ormat’s rights to develop, own, and operate future plants using this technology, enhances the company’s growth pipeline and technology edge. These industry and company-specific drivers support UBS’s decision to raise its price target to $148, based on a higher forward EV/EBITDA multiple that aligns with the broader energy sector and reflects improved growth expectations for geothermal driven by EGS investment and rising electricity demand.
In another report released on January 30, TipRanks – Anthropic also upgraded the stock to a Buy with a $141.00 price target.