Jefferies updated its stance on Ameresco Inc . (NYSE:AMRC), a leading clean technology integrator, by increasing the stock's price target to $35 from the previous $33. The firm maintained its Hold rating on the stock.
The revision follows the near completion of two out of three storage projects that Ameresco is developing for Southern California Edison (SCE). This progress is expected to bolster Ameresco's third-quarter cash flow as the company receives payments from SCE. The analyst from Jefferies noted that the market's attention this quarter will likely be on the status of the final SCE project, including the potential for liquidated damages and adjustments to cash flow from operations.
There is anticipation for Ameresco to confirm its adjusted EBITDA guidance, which would be a change from the company's previous trend of downward guidance revisions. The analyst expressed that the successful advancement of the SCE storage projects puts Ameresco closer to achieving its goals and is likely to support the company's financial performance in the near term.
Ameresco's work with SCE is part of the broader industry focus on energy storage, an essential component of the transition to more sustainable energy sources. The completion of these projects is significant for Ameresco as it underscores the company's capability to deliver on large-scale energy solutions.
Investors and market watchers are now looking forward to Ameresco's upcoming quarterly report, which will provide further details on the company's financial health and operational progress, including the crucial updates on the last of the SCE storage projects.
In other recent news, Ameresco, a clean technology integrator, has seen a significant increase in Q2 revenues of 34%, reaching $438 million, and a record backlog growth of 36% to $4.4 billion. The company has also brought 155 megawatts of Energy Assets into operation, marking a key milestone. However, Ameresco adjusted its fiscal year 2024 EBITDA guidance by 2% due to cost overruns from Southern California Edison projects, as reported by Piper Sandler.
Baird, a financial services firm, raised its price target for Ameresco from $32.00 to $42.00 and maintained its Outperform rating on the stock. The firm's analyst expressed increased confidence in Ameresco's 2025 estimates, suggesting that the company is well-positioned for continued strength.
Ameresco is nearing completion on two major battery energy storage system projects in partnership with Southern California Edison Company (SCE), with a third project scheduled for substantial completion in the fourth quarter of 2024. The company has also initiated a substantial solar photovoltaic installation at the Somersworth Landfill, expected to produce over 67 million kWh over two decades.
InvestingPro Insights
Ameresco Inc. (NYSE:AMRC) has been making significant strides in its clean technology projects, as evidenced by the near completion of two out of three storage projects for Southern California Edison. This progress aligns with several InvestingPro data points and tips that shed light on the company's financial position and market performance.
InvestingPro data shows that Ameresco's revenue growth has been robust, with a 33.91% increase in quarterly revenue as of Q2 2024. This growth is consistent with the company's progress on major projects and supports the InvestingPro Tip that analysts anticipate sales growth in the current year. Additionally, the company's market cap stands at $1.83 billion, reflecting investor confidence in its business model and growth prospects.
Another relevant InvestingPro Tip indicates that five analysts have revised their earnings upwards for the upcoming period. This positive sentiment aligns with the expectation that Ameresco will confirm its adjusted EBITDA guidance, as mentioned in the article. The company's ability to maintain its guidance could be a significant factor in its stock performance.
It's worth noting that Ameresco's stock has shown strong momentum, with a substantial 73.83% price total return over the past six months. This performance coincides with the progress on the SCE projects and may reflect growing investor optimism about the company's execution capabilities in the clean technology sector.
For investors seeking a more comprehensive analysis, InvestingPro offers 15 additional tips that could provide deeper insights into Ameresco's financial health and market position.
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