On Tuesday, RBC Capital Markets revised its rating on Ceres Power Holdings PLC (CWR:LN) stock, moving it from Underperform to Sector Perform. This adjustment comes with an increase in the price target to GBP1.80, up from the previous GBP1.60.
The analyst at RBC Capital cites a reduction in funding risk compared to the previous year and acknowledges Ceres Power's rapid commercial progress in 2024 as signs of the company's competitive edge in the cleantech licensing market.
The analyst's commentary highlights the recent developments that have led to the upgraded rating and price target. They noted that the company's quick turnaround in the past year demonstrates its competitiveness within the cleantech licensing arena. However, they also pointed out that potential delays from partners could impact royalty payments, which remains a risk factor for Ceres Power.
Despite these concerns, the analyst believes that Ceres Power is somewhat shielded from policy headwinds that are affecting its manufacturing peers, contributing to the decision to raise the stock to Sector Perform. This suggests that the company's business model may be more resilient to external policy changes compared to other firms that are more directly involved in manufacturing.
The new price target of 180p, up from 160p, reflects the analyst's updated expectations for Ceres Power's stock performance. RBC Capital's revised outlook indicates a neutral stance on the company's shares, suggesting that they anticipate the stock to perform in line with the overall sector.
The upgrade and price target increase represent a change in sentiment from RBC Capital towards Ceres Power Holdings PLC, signaling a more favorable view of the company's financial health and market position as of late 2024.
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