The additional falls suffered by Solaria do not intimidate Bank of America, which reaffirms its March price target and adds the Ibex company to its list of Europe’s favorite small- and mid-cap stocks.
International investment firms continue to disagree on the stock market outlook for renewable energy companies, the most severely punished on the stock market so far this year. In the absence of a greater consensus, investors are at least breathing a sigh of relief with the more favorable bias that the latest reports on the sector are acquiring.
The drastic reductions recorded in their share prices due to the correction initiated in January are helping to improve their recommendations. Solaria is an example of this more encouraging tone generated by the sector among analysis firms. Since last June 10, UBS withdrew for the first time in eight months its recommendation to ‘sell’ shares of the Ibex company, Barclays revised upwards its valuation to leave the way open for double-digit increases, and today Bank of America is raising its expectations for the value’s recovery.
The US investment firm reiterates its ‘buy’ recommendation, and maintains the target price issued on March 11 unchanged. The 28.50 euros per share set at that time represented an upside potential of 59%. Solaria’s shares, far from adopting the upward trend predicted by Bank of America, have deepened their correction in recent months.
On March 10, it was trading at 17.88 euros. The backing of the US firm boosted its share price by 7% the following day, but four months later it is once again trading at levels below those of March, at 15.78 euros at the close of yesterday’s session.
The most bearish stock on the Ibex in 2021, with losses of 33% since the beginning of January, now has a higher upside potential from Bank of America than in March. The target price, reaffirmed at 28.50 euros per share, now represents an upside margin of 80%.
The optimism conveyed by this valuation by Bank of America has led the US firm to include Solaria in its list of favorite European stocks among small and mid-cap companies.