Pareto upgrades Aker Carbon Capture (ACC) from hold to buy, and sets price target from NOK 17 to NOK 20. This was revealed in ACC’s latest brokerage analysis.
“We are in the process of revising our estimates for ACC in the medium term following our award from Ørsted. ACC appears to be an attractive investment area in the carbon capture market with strong market dynamics, growing coverage for backlog and a good cash position,” writes Pareto Securities analyst Jørgen Søvik Opheim, and adds :
However, this still depends on governments committing to net zero emissions.
ACC recently secured a $1 billion contract from Ørsted to deliver carbon capture and storage plants to Denmark. Pareto writes that adjusted backlog coverage and Ørsted’s recent contract of five Just Catch units provide increased income predictability for the company.
“We expect a 25/27 percent increase in income for fiscal years 2024/2025. The Company has a strong cash position and strong industry backers, which presents opportunities to secure its contract share in the carbon capture market,” Pareto wrote.
The price target for Pareto Securities is 100 percent more than the price target for Fearnley Securities. Fearnley downgraded the ACC rating last week from hold to sell with a NOK 10 price target.
Stock exchange company Aker Carbon Capture also announced today that it has obtained a study from Söderenergi in Sweden. The aim of the study is to implement carbon capture at Igelstaverket, one of the largest district heating plants in Sweden.
The company rose about 8 percent at most after the new decade, but it’s now back down to about 0.7 percent for the day. The company itself writes that it is looking forward to working in Sweden, but does not write anything about the expected turnover or profitability from the contract.
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