汇丰－wind200703全球风能行业
We are initiating coverage of the global wind sector. Our individual
stock ratings in the sector imply an overweight stance. Our two
top picks are Gamesa and Clipper. We have an Underweight (V)
rating on Suzlon. We forecast 49% 2006-09 sector EPS CAGR and
estimate that the sector is trading at a 60% discount to the market
on a PEG basis
Key valuation conclusions
We are initiating coverage of the Global Wind sector. Our individual stock ratings in the sector imply an
Overweight stance, based on our expectations for excellent growth in demand for wind turbines of 14%
CAGR over 2006-10 and we expect this to translate into an impressive 2006-09 EPS CAGR of 49%. For
the stocks in our coverage universe, we expect an average return of 11% in 2007. However, this is
dragged down by Suzlon, for which our target price suggests 19.2% downside.
Our positive stance on the sector is in spite of the strong share performance over 2006 and 2007 (to date),
driven by a record year for the wind industry in 2006 and M&A speculation in early 2007. We still
believe that there is selective value in the sector and that it has excellent growth prospects. On a PEG
basis, the sector is trading at discounts of 60% to the European market and 70% to the US.
We are initiating coverage of the five global pure-play wind stocks. We have Overweight ratings on
Clipper and Gamesa with target prices of 825p and EUR29, respectively, owing mostly to our
expectations for growth. We have Neutral ratings on Vestas (DKK320 target price) and Nordex (EUR25
target price).