Download PDF

1. Company Snapshot

1.a. Company Description

Vestas Wind Systems A/S engages in the design, manufacture, installation, and services of wind turbines the United States, the United Kingdom, Denmark, and internationally.The company operates in two segments, Power Solutions and Service.The Power Solutions segment offers onshore and offshore wind power plants, wind turbines, development sites, etc.


The Service segment engages in the sale of service contracts, spare parts, and related activities.The company was founded in 1898 and is headquartered in Aarhus, Denmark.

Show Full description

1.b. Last Insights on VWS

Vestas Wind Systems' recent performance was driven by strong Q3 earnings, with sales of €5.34 billion and net income of €302 million, exceeding expectations. The company's net profit margin jumped to 5%, a significant improvement from last year's 0.3%. A share buy-back program was announced to adjust its capital structure, which is a positive event for shareholders. Additionally, the company raised its full-year revenue guidance to €18.5–19.5 billion, reflecting improving business momentum. Analysts have increased the fair value estimate, with a price target moving to DKK 153.50.

1.c. Company Highlights

2. Vestas' Q3 Earnings: A Solid Performance Amidst Challenges

Vestas reported a revenue of EUR 5.3 billion for Q3, representing a 3% year-on-year increase driven by higher deliveries, despite negative foreign exchange developments. The EBIT margin stood at 7.8%, achieved through improved Onshore project execution and lower warranty costs, partly offset by manufacturing ramp-up costs. Earnings per share (EPS) was not explicitly mentioned in the transcript, but the company's financial performance was solid. The order intake was 4.6 gigawatts, up 4% year-on-year, driven by the U.S. and Germany, with Onshore order intake increasing by more than 60% quarter-on-quarter.

Publication Date: Nov -06

📋 Highlights
  • Revenue Growth:: Q3 revenue reached EUR 5.3 billion, up 3% YoY, driven by higher deliveries despite foreign exchange headwinds.
  • EBIT Margin:: Achieved 7.8% margin, boosted by improved Onshore execution and lower warranty costs, partially offset by manufacturing ramp-up.
  • Order Intake:: 4.6 GW booked, +4% YoY, with Onshore surging over 60% QoQ, led by the U.S. and Germany.
  • Share Buyback:: Initiated EUR 150 million buyback, reflecting confidence in financial stability and shareholder returns.
  • Outlook Narrowed:: Revenue guidance updated to EUR 18.5–19.5 billion, with EBIT margin before special items at 5–6%.

Segmental Performance

In Power Solutions, revenue increased by 4% year-on-year, driven by higher megawatt deliveries at stable average selling prices. The EBIT margin before special items improved to 8.1%. In Service, revenue declined by 3% year-on-year due to lower transactional sales compared to the previous year, while contract revenue remained stable. The company's Service segment reached 159 gigawatts under Service, flat compared to Q2, as additions were offset by a higher level of expiries and deselecting in the quarter.

Guidance and Outlook

Vestas narrowed its revenue outlook to EUR 18.5 billion to EUR 19.5 billion, with an EBIT margin before special items expected at 5% to 6%. The Service segment is anticipated to generate an EBIT before special items of around EUR 625 million. Analysts estimate next year's revenue growth at 10.2%. The company's guidance suggests a stable outlook, despite challenges in the Offshore ramp-up.

Valuation Metrics

With a P/E Ratio of 28.36, P/B Ratio of 6.96, and EV/EBITDA of 14.1, the market seems to be pricing in a certain level of growth and profitability for Vestas. The company's ROE stands at 23.64%, indicating a relatively strong return on equity. The Net Debt/EBITDA ratio is -2.48, reflecting Vestas' net cash position.

Operational Highlights

Vestas is progressing well with its Offshore ramp-up, with a backlog of more than EUR 10 billion in projects. The company expects to reach a more stable full capacity utilization by the end of this year, next year, and into 2027. The Onshore business is performing reasonably well, with potential for growth globally, especially in Europe. As per Henrik Andersen, "we encourage the APAC region to do better and are confident that it will see an improvement in the coming years."

3. NewsRoom

Card image cap

VWDRY vs. KNYJY: Which Stock Should Value Investors Buy Now?

Dec -03

Source:

Card image cap

Does Vestas Still Offer Value After a 52% Rally in 2025?

Dec -03

Source:

Card image cap

Vestas Expands in Poland to Supply Germany’s Rapid Wind Buildout

Dec -02

Source:

Card image cap

Vestas Secures 660 MW Offshore Wind Order in EMEA

Dec -02

Source:

Card image cap

Cheap Chinese wind turbines to flood British waters

Nov -24

Source:

Card image cap

Is Vestas Wind Systems (VWDRY) Stock Outpacing Its Industrial Products Peers This Year?

Nov -21

Source:

Card image cap

What Catalysts Are Reshaping the Narrative for Vestas Amid Analyst Revisions and New Orders

Nov -14

Source:

Card image cap

Enersys (ENS) Soars to 52-Week High, Time to Cash Out?

Nov -13

Source:

4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (6.43%)

6. Segments

Power Solutions

Expected Growth: 6.0%

Vestas Wind Systems' Power Solutions segment growth is driven by increasing demand for renewable energy, government incentives, and declining technology costs. The company's strong market position, diversified product portfolio, and expanding service offerings also contribute to its 6.0% growth rate, driven by investments in wind energy projects and favorable regulatory environments.

Service

Expected Growth: 8.0%

Vestas Wind Systems A/S service growth of 8.0% is driven by increasing demand for wind energy, driven by renewable energy targets, declining technology costs, and government incentives. The company's service segment benefits from long-term maintenance contracts, high-margin upgrades, and digitalization efforts, enabling predictive maintenance and increasing turbine efficiency.

7. Detailed Products

Vestas Wind Turbines

Vestas wind turbines are designed to convert wind energy into electricity. They offer a wide range of turbine models with varying hub heights, rotor diameters, and power ratings to suit different wind conditions and project requirements.

Vestas Wind Power Solutions for Islands and Isolated Grids

Vestas offers wind power solutions specifically designed for islands and isolated grids, including hybrid power plants that combine wind power with other energy sources like diesel or solar power.

Vestas Digital Solutions

Vestas digital solutions include advanced data analytics, monitoring, and control systems to optimize wind farm performance, predict maintenance needs, and improve overall efficiency.

Vestas Service and Maintenance

Vestas offers a range of service and maintenance solutions, including inspections, repairs, and replacements, to ensure optimal turbine performance and extend their lifespan.

Vestas Wind Farm Development and Construction

Vestas offers wind farm development and construction services, including site assessment, permitting, and project management, to help customers bring their wind energy projects to life.

8. Vestas Wind Systems A/S's Porter Forces

Forces Ranking

Threat Of Substitutes

The threat of substitutes for Vestas Wind Systems A/S is relatively low due to the growing demand for renewable energy sources and the limited availability of alternative energy solutions that can match the efficiency and sustainability of wind power. Although other renewable energy sources like solar and hydroelectric power exist, they have their own limitations and geographical constraints, making wind power a preferred choice for many regions.

Bargaining Power Of Customers

The bargaining power of customers for Vestas Wind Systems A/S is moderate. While customers, typically utility companies and governments, have some negotiating power due to the availability of alternative suppliers in the market, Vestas's strong brand reputation, extensive product portfolio, and comprehensive service offerings limit the customers' ability to exert significant pressure on pricing and terms.

Bargaining Power Of Suppliers

The bargaining power of suppliers for Vestas Wind Systems A/S is relatively low. Although some critical components like bearings and gearboxes have limited suppliers, Vestas's scale, market position, and long-term supply agreements enable it to negotiate favorable terms with its suppliers. Additionally, Vestas's efforts to develop and source materials and components from a broader supplier base further mitigate supplier bargaining power.

Threat Of New Entrants

The threat of new entrants for Vestas Wind Systems A/S is moderate. The wind turbine manufacturing industry requires significant investment in research and development, manufacturing capacity, and distribution networks. While these barriers to entry are substantial, they do not prevent new entrants entirely. The market's growth potential and government incentives for renewable energy attract new players, but the competition remains manageable due to the industry's complexity and Vestas's first-mover advantage.

Intensity Of Rivalry

The intensity of rivalry among competitors for Vestas Wind Systems A/S is high. The global wind turbine market is highly competitive, with major players like Siemens Gamesa, GE Renewable Energy, and Goldwind. These competitors offer similar products and services, leading to aggressive pricing, innovation, and marketing strategies. The competition is further intensified by the industry's growth, the similarity of products, and the competitors' strategic importance.

9. SWOT Analysis

Strength

Weaknesses

Opportunities

Threats

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

Value
Debt Weight 0.00%
Debt Cost 4.28%
Equity Weight 100.00%
Equity Cost 9.11%
WACC 9.11%
Leverage 0.00%

11. Quality Control: Vestas Wind Systems A/S passed 4 out of 9 key points

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

Stock-Card
Sandvik

A-Score: 5.6/10

Value: 3.1

Growth: 4.9

Quality: 7.1

Yield: 3.8

Momentum: 6.5

Volatility: 8.0

1-Year Total Return ->

View Full Report
Stock-Card
Siemens

A-Score: 5.5/10

Value: 3.6

Growth: 5.0

Quality: 5.6

Yield: 5.0

Momentum: 7.5

Volatility: 6.3

1-Year Total Return ->

View Full Report
Stock-Card
Eaton

A-Score: 4.5/10

Value: 0.7

Growth: 5.9

Quality: 6.9

Yield: 2.5

Momentum: 6.0

Volatility: 5.0

1-Year Total Return ->

View Full Report
Stock-Card
KONE

A-Score: 4.3/10

Value: 1.8

Growth: 3.3

Quality: 6.4

Yield: 5.6

Momentum: 6.0

Volatility: 2.7

1-Year Total Return ->

View Full Report
Stock-Card
Vestas Wind Systems

A-Score: 3.9/10

Value: 4.2

Growth: 7.6

Quality: 4.9

Yield: 1.2

Momentum: 4.0

Volatility: 1.3

1-Year Total Return ->

View Full Report
Stock-Card
Siemens Energy

A-Score: 3.7/10

Value: 1.5

Growth: 4.6

Quality: 4.6

Yield: 0.0

Momentum: 10.0

Volatility: 1.3

1-Year Total Return ->

View Full Report

Peers Metrics

12.e Scoring Insights

12.f DCF BETA

Parameters

Short Term Growth

Short term Time

Long-Term Growth

WACC

Target Price

159.75$

Current Price

159.75$

Potential

-0.00%

Expected Cash-Flows