In
a
recent
interview,
Ørsted
(ORSTED)
chief
executive
Mads
Nipper
said
he
was
ready
to
“fight
with
everything
[he
has]
got”
to
soothe
investor
grievances.
The
Danish
renewable
energy
company
is
in
hot
water
after
it
announced
it
would
cut
around
800
jobs
and
suspend
its
dividend.
The
group
has
also
had
to
back
away
from
two
significant
US
projects,
the
Ocean
Wind
I
and
II
schemes,
because
of
rising
costs,
which
pushed
the
group
to
a
net
loss
of
£2.2
billion.
It
also
withdrew
from
offshore
wind
markets
in
Norway,
Spain
and
Portugal,
as
well
as
putting
into
doubt
the
viability
of
its
Hornsea
3
project,
which
is
expected
to
supply
power
to
over
3.3
million
homes
in
the
UK.
Over
the
three
years
to
February
2024
Ørsted
shares
have
suffered
a
devastating
fall
from
grace.
Key
Morningstar
Metrics
for
Ørsted
• Fair
Value
Estimate:
DKK
540.00;
• Morningstar
Rating: ★★★★;
• Morningstar
Economic
Moat
Rating:
None;
• Morningstar
Uncertainty
Rating:
Medium.
Its
cumulative
return
rate
dropped
to
59.01%
versus
the
Morningstar
Developed
Market
Renewable
Energy
index,
which
gained
3%
over
that
same
period.
Its
share
price
is
also
down
by
60.98%
from
£120.09
to
£45.49
over
the
past
three
years.
Considering
this
grim
picture,
it’s
worth
asking
whether
institutional
backers
are
buying
Nipper’s
latest
intervention.
This
appears
to
be
a
mixed
bag.
Who
is
Buying
Ørsted?
Ninety-One
Global
Environment, which
holds
the
stock
at
4.76%
of
the
fund,
added
an
extra
232,135
shares
in
the
company
in
December
last
year.
Legal
&
General
PMC
Multi
Asset
Pension upped
its
stake
by
109,956
shares,
meanwhile Scottish
Widows
SSgA
Europe
Ex
UK
Equity
Index and WS
Macquarie
Global
Infrastructure
Securities added
54,758
and
22,805
shares,
respectively.
Morningstar
Analyst,
Tancrede
Fulop,
has
assigned
the
stock
a
Morningstar
Star
Rating
of
4.
He
is
not
concerned
about
the
current
pessimistic
outlook.
“The
new
investments
and
2024,
2026,
and
2030
EBITDA
targets
are
in
line
with
our
estimates,
so
we
confirm
our
DKK
540
fair
value
estimate,
offering
40%
upside
to
the
current
share
price,”
he
says.
“The
farm-down
of
the
Hornsea
3,
(selling
a
stake
in
an
offshore
wind
farm
typically
during
the
construction
phase),
will
be
a
positive
catalyst.
“Furthermore,
Orsted
is
less
exposed
to
declining
European
wholesale
power
prices
than
most
European
utilities
and
will
benefit
from
a
decline
in
interest
rates,”
he
says.
Who
is
Selling
Ørsted?
However,
Baillie
Gifford
leads
the
pack
in
selling
the
stock.
In
December
2023 Baillie
Gifford
Positive
Change and
Baillie
Gifford
Multi
Asset
Growth disposed
of
805,523
and
13,409
Orsted
shares.
UK
pension
funds
have
also
sold
their
shares
in
the
stock,
with
the
Aviva
Diversified
Assets
Pension fund
and
the
Hamilton
Pension fund
shedding
49,819
and
22,962
shares,
respectively.
In
a
statement
to
The
Guardian,
RBC
analyst
Alexander
Wheeler
says
markets
expected
Ørsted
to
seek
more
investor
support,
which
he
argues
would
have
dealt
with
the
issues
and
“removed
future
risk.”
“We
now
have
a
period
where
Ørsted
needs
to
execute
on
various
components
of
its
plan
to
improve
its
balance
sheet
metrics
over
the
medium
term,”
Wheeler
says.
Yet,
Fulop
still
believes
the
worst
is
over
for
the
company.
That’s
despite
his
belief
the
company’s
business
plan
will
face
an
uphill
battle.
“The
business
plan
will
hinge
on
material
divestments
and
farm
downs,
and
typically
the
buyers
of
stakes
in
offshore
wind
farms
are
like
financial
players,”
he
says.
“Despite
the
issues
there
is
still
appetite
from
them
to
buy
stakes
into
the
farms
and
Ørsted
badly
needs
buyers
to
be
able
to
fund
future
projects.”
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