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1. Company Snapshot

1.a. Company Description

Solaria Energía y Medio Ambiente, S.A. engages in the solar photovoltaic power generation business.The company owns, manages, and operates photovoltaic plants in Spain, Italy, Uruguay, and Greece.The company was incorporated in 2002 and is headquartered in Madrid, Spain.

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1.b. Last Insights on SLR

Recent earnings highlights for Solaria Energía y Medio Ambiente, S.A. reveal negative drivers impacting the company's performance. The Q4 2024 earnings call showed robust EBITDA growth, but high electricity prices and new tax impacts posed significant challenges. Strategic capacity expansion efforts were overshadowed by these headwinds, which may continue to weigh on the company's near-term prospects.

1.c. Company Highlights

2. Solaria's Earnings Shine with Record Profit and Ambitious Growth Plans

Solaria's financial performance in the first half of 2025 was impressive, with a net profit increase of nearly 100%, a record in the company's history. The company's EBITDA reached a record EUR 140 million, exceeding its guideline for the year. Earnings per share (EPS) came in at 0.23, beating estimates of 0.2016. Revenue growth is expected to continue, with analysts estimating a 15.6% increase next year. The company's cash position remains stable, and it is focused on maintaining its discipline around CapEx, with a global average of less than EUR 0.38 per watt.

Publication Date: Oct -28

📋 Highlights
  • Net Profit Growth: Solaria achieved a near 100% increase in net profit for H1 2025, a historical record.
  • Grid Capacity Progress: The company connected 300 MW of new installations and aims to reach 3 GW of capacity by year-end 2025.
  • Battery Expansion: Solaria is scaling battery projects in Spain, Italy, Germany, and the UK, targeting double-digit returns (12-13% IRR) in Spain.
  • Financial Strength: EBITDA hit EUR 140 million (exceeding annual guidance), with CapEx under EUR 0.38 per watt and stable cash reserves.
  • Strategic Buybacks: Solaria plans to acquire at least 10% of its shares, with potential impactful contracts to be revealed at the November 17 Investor Day.

Expansion into Batteries and Data Centers

Solaria is expanding its business into batteries, with a focus on Spain, Italy, Germany, and the UK. The company has developed an enormous volume of megawatts per hour of batteries under construction, which will be connected to the grid in 2025 and 2026. According to CEO Jose Arturo Diaz-Tejeiro Larranaga, the company aims to be the leader in the short term in batteries in Spain and has already established a strong presence in Italy, Portugal, and Germany. The return on investment for batteries in Spain is expected to be double-digit, with a potential return of 12-13% project IRR.

Valuation and Growth Prospects

With a P/E Ratio of 15.85 and an EV/EBITDA of 12.87, Solaria's valuation suggests that the market is pricing in significant growth prospects. The company's ROE of 19.38% and ROIC of 7.75% indicate a strong ability to generate returns on equity and invested capital. As Solaria continues to expand its business into new areas, such as batteries and data centers, the company's growth prospects are likely to remain robust. The upcoming Investor Day on November 17 is expected to provide more visibility into the company's business plan and activities.

Outlook and Risks

Solaria is optimistic about the future price of electricity in Europe and is expecting a strong demand in the future, driven by data centers, electrical vehicles, and industrial demand. However, the company's net debt to EBITDA ratio of 4.84 may pose a risk to its financial flexibility. As the company continues to grow and expand its business, it will be important to monitor its ability to manage its debt and maintain its discipline around CapEx.

3. NewsRoom

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Solaria Said to Hire Goldman Sachs to Seek Data Center Partner

Nov -15

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Solaria (BME:SLR): Assessing Valuation After Recent Share Price Moves

Oct -03

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Solaria (BME:SLR) Margin Expansion Highlights Role of €28.9M One-Off in Narratives Debate

Oct -02

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Solaria Energia y Medio Ambiente SA (XMAD:SLR) Q1 2025 Earnings Call Highlights: Record Profit ...

Jun -04

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Solaria secures $106m for 175MW Spanish renewable energy project

May -27

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Solaria Energia y Medio Ambiente SA (XMAD:SLR) Q4 2024 Earnings Call Highlights: Strategic ...

Feb -28

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Solaria Energia y Medio Ambiente SA (SEYMF) Q3 2024 Earnings Call Highlights: Navigating ...

Nov -19

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Complete Solaria Inc (CSLR) Q3 2024 Earnings Call Highlights: Strategic Restructuring Amidst ...

Nov -14

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4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (15.00%)

6. Segments

Renewable Energy

Expected Growth: 15%

Solaria Energía y Medio Ambiente, S.A.'s 15% growth in Renewable Energy is driven by increasing demand for clean energy, declining solar panel costs, favorable government policies and incentives, and rising environmental concerns. Additionally, the company's strategic expansion into new markets, investments in R&D, and partnerships with key industry players have contributed to its rapid growth.

Services

Expected Growth: 11%

Solaria Energía y Medio Ambiente, S.A.'s 11% growth is driven by increasing demand for renewable energy, government incentives for sustainable practices, and strategic partnerships expanding its service offerings in energy efficiency and environmental consulting.

7. Detailed Products

Solar Energy Systems

Solaria Energía y Medio Ambiente, S.A. designs and installs solar energy systems for residential, commercial, and industrial clients, providing clean and sustainable energy solutions.

Energy Efficiency Solutions

The company offers energy efficiency solutions, including energy audits, energy management systems, and energy-saving technologies, to help clients reduce their energy consumption and costs.

Renewable Energy Consulting

Solaria provides consulting services for renewable energy projects, including feasibility studies, project development, and project management.

Environmental Services

The company offers environmental services, including environmental impact assessments, waste management, and pollution prevention, to help clients minimize their environmental footprint.

Sustainable Infrastructure Development

Solaria develops sustainable infrastructure projects, including green buildings, sustainable transportation systems, and eco-friendly urban planning.

8. Solaria Energía y Medio Ambiente, S.A.'s Porter Forces

Forces Ranking

Threat Of Substitutes

The threat of substitutes for Solaria Energía y Medio Ambiente, S.A. is medium due to the availability of alternative energy sources such as wind and hydro power.

Bargaining Power Of Customers

The bargaining power of customers for Solaria Energía y Medio Ambiente, S.A. is low due to the lack of negotiating power of individual customers.

Bargaining Power Of Suppliers

The bargaining power of suppliers for Solaria Energía y Medio Ambiente, S.A. is medium due to the presence of multiple suppliers of solar panels and equipment.

Threat Of New Entrants

The threat of new entrants for Solaria Energía y Medio Ambiente, S.A. is high due to the relatively low barriers to entry in the renewable energy industry.

Intensity Of Rivalry

The intensity of rivalry for Solaria Energía y Medio Ambiente, S.A. is high due to the presence of multiple competitors in the renewable energy industry.

9. SWOT Analysis

Strength

Weaknesses

Opportunities

Threats

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

Value
Debt Weight 66.97%
Debt Cost 4.07%
Equity Weight 33.03%
Equity Cost 9.84%
WACC 5.97%
Leverage 202.72%

11. Quality Control: Solaria Energía y Medio Ambiente, S.A. passed 5 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
Alerion Clean Power

A-Score: 5.3/10

Value: 5.0

Growth: 6.7

Quality: 6.0

Yield: 5.0

Momentum: 8.0

Volatility: 1.3

1-Year Total Return ->

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Cloudberry Clean Energy

A-Score: 5.0/10

Value: 5.8

Growth: 9.9

Quality: 2.5

Yield: 0.0

Momentum: 6.5

Volatility: 5.3

1-Year Total Return ->

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Ecoener

A-Score: 4.6/10

Value: 4.1

Growth: 5.2

Quality: 3.4

Yield: 1.2

Momentum: 7.0

Volatility: 6.7

1-Year Total Return ->

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Stock-Card
Solaria Energía y Medio Ambiente

A-Score: 4.5/10

Value: 4.5

Growth: 8.9

Quality: 6.7

Yield: 0.0

Momentum: 5.0

Volatility: 1.7

1-Year Total Return ->

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Stock-Card
PNE

A-Score: 4.1/10

Value: 4.6

Growth: 2.3

Quality: 3.1

Yield: 0.6

Momentum: 6.5

Volatility: 7.7

1-Year Total Return ->

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Stock-Card
OX2

A-Score: 2.9/10

Value: 4.6

Growth: 4.2

Quality: 2.8

Yield: 0.0

Momentum: 5.0

Volatility: 0.7

1-Year Total Return ->

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Peers Metrics

12.e Scoring Insights

12.f DCF BETA

Parameters

Short Term Growth

Short term Time

Long-Term Growth

WACC

Target Price

16.86$

Current Price

16.86$

Potential

-0.00%

Expected Cash-Flows