(For more Reuters BUY OR SELL stories, click on [BUYSELL/])
* Bulls see outlook as being conservative
* Bears fear wind market will remain difficult
By Christoph Steitz
FRANKFURT, Oct 15 Shares in German wind turbine
maker Nordex (NDXG.DE) have lost nearly a third of their value
since the beginning of the year, as a lack of project funding
and weak demand is still burdening the industry.
Thomson Reuters database StarMine shows that a third of
analysts covering the stock rate the company "buy", while 22
percent advise selling the stock.
"We continue to see the management guidance as being too
conservative," DZ Bank analyst Mario Kristl wrote, keeping a
"buy" rating on the stock.
The company expects a slight increase in 2010 sales
year-on-year as well as a 4 percent rise in its full-year EBIT
margin. According to Thomson Reuters I/B/E/S, sales are expected
to rise by 4.2 percent, while the company's EBIT margin is seen
at 3.6 percent.
Jefferies analysts, which also rate the stock "buy", see
margins growing in the longer term.
"We think the FY10 guidance ... is achievable while further
incremental margin improvements drive the longer term value in
the stock," they wrote.
At 4.3 percent, Nordex's 2011 EBIT margin is expected to
come in slightly higher vs 2010, Thomson Reuters I/B/E/S showed.
MARKET TO REMAIN TOUGH
Bryan & Garnier analyst Ben Lynch notes that Nordex shares
have "massively outperformed" Danish market leader Vestas
(VWS.CO) and Spain's Gamesa (GAM.MC) since the research company
initiated the sector on July 29.
Nordex shares have dropped about 9 percent since July 29,
compared with Vesta's 29-percent drop and a 38-percent fall in
But Lynch cut the stock to "sell" from "buy" as he expects
the market situation to remain difficult in 2010, with little
upside for next year, a view that is shared by Cheuvreux analyst
"Due to low order intake in the U.S. and the European wind
turbine markets, we expect a tough 2010 for the entire sector.
We maintain our cautious stance on Nordex shares," he wrote,
with a "sell" rating on the stock.