Shares of Orsted (DOGEF) plunged Tuesday, January 21st, as President Trump banned leasing and permitting for new wind projects and the Danish company announced a major write-down on its U.S. offshore business following delays.
Invest with Confidence:
- Follow TipRanks' Top Wall Street Analysts to uncover their success rate and average return.
- Join thousands of data-driven investors – Build your Smart Portfolio for personalized insights.
Orsted, the world’s largest offshore wind developer, announced impairments totalling DKr12.1 billion ($1.7 billion) for its Fiscal fourth quarter on Monday, citing higher interest rates, supply chain challenges and “market uncertainties.”
Shares of the company plunged in European trade by as much as 17%, taking its total decline since 2021 to 84%. In 2023 the company announced an impairment of around $4 billion on its U.S. assets.
Announcing the latest hit to the company’s financials, Mads Nipper, Group President and CEO, said they were “very disappointing” but that the company remains committed to the U.S. market.
Trump Signals Way the Wind Is Blowing for Orsted
Adding to the uncertainty, Donald Trump signed an executive order on Monday temporarily halting offshore wind lease sales in federal waters, while also pausing any approvals, permits and loans for both onshore and offshore wind projects.
“We’re not going to do the wind thing. Big, ugly wind mills. They ruin your neighborhood,” Trump said, according to Reuters.
Orsted’s two U.S. project in construction, Sunrise Wind and Revolution Wind, already have necessary federal permits.
However, the decision to halt permitting and leasing is clearly weighing on the sector and the outlook for the company’s U.S. business.
Trump also moved to withdraw the U.S. from the Paris climate accord, further signalling the direction of travel the administration is taking with regards renewable energy.
Is DOGEF a Good Stock to Buy?
Overall, Wall Street has a Hold consensus rating on DOGEF, based on three Buys, 10 Holds and one Sell. However, the average DOGEF price target of $58.11 implies about 35% upside after a 23% decline in the shares in the last year.
