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1. Company Snapshot

1.a. Company Description

OPAL Fuels Inc.engages in the production and distribution of renewable natural gas for use as a vehicle fuel for heavy and medium-duty trucking fleets.It also designs, develops, constructs, operates, and services fueling stations for trucking fleets that use natural gas to displace diesel as transportation fuel.


In addition, it offers design, development, and construction services for hydrogen fueling stations.Further, the company generates and sells renewable power to utilities.As of May 1, 2022, it owned and operated 24 biogas projects.


The company was founded in 1998 and is based in White Plains, New York.

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1.b. Last Insights on OPAL

OPAL Fuels' recent performance was driven by strong Q2 revenue growth, rising 13% year-over-year. The company's RNG production surged 33% compared to Q2 2024, contributing to the revenue increase. Additionally, OPAL Fuels completed its fourth sale of IRA investment tax credits, generating $17.3 million. This milestone highlights the growing market for renewable natural gas and the company's progress in reducing carbon emissions. The company's inclusion in the Russell 3000 and Russell 2000 indexes also boosted its visibility.

1.c. Company Highlights

2. OPAL Fuels' Q3 2025 Earnings: A Mixed Bag

OPAL Fuels reported adjusted EBITDA of $19.5 million, lower compared to the same period last year, primarily due to a lower RIN price environment. The company's EPS came in at $0.05, significantly below analyst estimates of $0.41. Revenue growth was driven by a 30% year-over-year increase in RNG production, reaching 1.3 million MMBtus. Despite the challenging RIN price environment, the company remains on track to meet its full-year 2025 guidance. With a P/E Ratio of 7.49 and an EV/EBITDA of 5.08, the stock appears to be relatively undervalued.

Publication Date: Nov -12

📋 Highlights
  • Q3 RNG Production Growth:: Produced 1.3 million MMBtus, up 30% YoY, driven by Sapphire, Pulk, and improved fleet reliability.
  • Financial Performance:: Adjusted EBITDA of $19.5M, below prior year due to lower RIN prices, but on track for 2025 guidance with Q4 sequential growth.
  • Capital Projects Expansion:: Launched Atlantic project (0.33M MMBtu annual capacity) and started CMS RNG (1.0M MMBtu net to OPL) in North Carolina.
  • ITC Monetization:: Generated $43M in gross proceeds from four ITC transactions year-to-date.
  • 2026 Growth Outlook:: Anticipates strong 2026 performance with full-year 45Z tax credit contributions and D3 RIN price lift to $2.40.

Operational Highlights

The operating fleet is performing in a more repeatable manner, resulting in consistency and reliability. The company brought the Atlantic project online, adding approximately 0.33 million MMBtu of annual design capacity, and began construction at its CMS RNG project in North Carolina, representing 1.0 million MMBtu of annual design capacity net to OPAL. As Adam Comora mentioned, the company expects a strong growth in 2026, supported by another year of strong production growth and a full year of 45Z tax credits.

Growth Prospects

The company is optimistic about the potential for natural gas vehicle adoption, particularly for heavy-duty trucking. With a focus on downstream fuel distribution, OPAL Fuels is building a balanced portfolio to take advantage of both the RFS market and the downstream CNG/RNG market. Analysts estimate revenue growth of 15.5% for next year, driven by the company's increasing RNG production and improving RIN pricing.

Valuation and Capital Position

With a P/B Ratio of 0.08 and a ROE of 4.84%, the company's valuation appears attractive. OPAL Fuels is committed to using its operating cash flow and existing liquidity resources to fund its growth, and will secure new capital for new projects. The company's net debt to EBITDA ratio is -0.77, indicating a strong capital position. As the company continues to execute on its growth strategy, investors may want to keep a close eye on the stock.

3. NewsRoom

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OPAL Fuels Inc. (NASDAQ:OPAL) Receives Average Rating of “Reduce” from Brokerages

Dec -01

Source: defenseworld.net

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3 Alternative Energy Stocks to Watch Amid Near-Term Challenges

Nov -18

Source: zacks.com

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Critical Comparison: OPAL Fuels (NASDAQ:OPAL) versus TC Energy (NYSE:TRP)

Nov -18

Source: defenseworld.net

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OPAL FUELS INC (OPAL) May Find a Bottom Soon, Here's Why You Should Buy the Stock Now

Nov -10

Source: zacks.com

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OPAL Fuels Inc. (OPAL) Q3 2025 Earnings Call Transcript

Nov -07

Source: seekingalpha.com

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OPAL Fuels Reports Third Quarter 2025 Results

Nov -07

Source: businesswire.com

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SJI and OPAL Fuels Celebrate Landmark Renewable Natural Gas (RNG) Project with Atlantic County Utilities Authority

Oct -23

Source: businesswire.com

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OPAL Fuels Announces Third Quarter 2025 Earnings Release Date and Conference Call

Oct -22

Source: businesswire.com

4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (8.27%)

6. Segments

Fuel Station Services

Expected Growth: 4.83%

OPAL Fuels Inc.'s 4.83% growth in Fuel Station Services is driven by increasing demand for alternative fuels, government incentives for eco-friendly infrastructure, and strategic partnerships with major transportation companies. Additionally, the company's focus on expanding its network of fueling stations and investing in digital platforms to enhance customer experience have contributed to its growth momentum.

RNG Fuel

Expected Growth: 10.98%

RNG Fuel from OPAL Fuels Inc. growth driven by increasing demand for renewable energy, government incentives for low-carbon fuels, and strategic partnerships expanding distribution channels. Additionally, RNG's lower carbon intensity and competitive pricing compared to traditional fuels contribute to its 10.98% growth.

Renewable Power

Expected Growth: 10.27%

OPAL Fuels Inc.'s 10.27% growth in Renewable Power is driven by increasing adoption of clean energy, declining costs of renewable technologies, and favorable government policies. Additionally, growing demand for low-carbon fuels, expansion into new markets, and strategic partnerships contribute to the company's rapid growth.

Equity Method Investments

Expected Growth: 10.98%

OPAL Fuels Inc.'s 10.98% growth in Equity Method Investments is driven by increasing demand for renewable energy solutions, strategic partnerships, and expansion into new markets. Additionally, favorable government policies and incentives for clean energy adoption have contributed to the growth. The company's ability to effectively manage its investments and optimize returns has also played a key role in achieving this growth rate.

Intersegment

Expected Growth: 4.83%

OPAL Fuels Inc.'s 4.83% intersegment growth is driven by increasing demand for renewable natural gas, strategic partnerships, and expansion into new markets. Additionally, investments in infrastructure and technology upgrades have improved operational efficiency, leading to higher volumes and revenue growth.

Other

Expected Growth: 10.27%

OPAL Fuels Inc.'s 10.27% growth is driven by increasing adoption of renewable natural gas (RNG) in the transportation sector, government incentives for low-carbon fuels, and strategic partnerships with waste management companies to secure feedstock supply.

7. Detailed Products

Renewable Natural Gas (RNG)

A cleaner-burning alternative to traditional fossil fuels, produced from organic waste, agricultural waste, and wastewater treatment plants.

Liquified Natural Gas (LNG)

A cleaner-burning alternative to diesel fuel, used for heavy-duty transportation and industrial applications.

Compressed Natural Gas (CNG)

A cleaner-burning alternative to gasoline, used for light-duty transportation and fleet vehicles.

Electric Vehicle (EV) Charging Infrastructure

A comprehensive solution for electric vehicle charging, including hardware, software, and network services.

Hydrogen Fuel Cell Systems

A zero-emission fuel cell system for heavy-duty transportation and industrial applications.

8. OPAL Fuels Inc.'s Porter Forces

Forces Ranking

Threat Of Substitutes

The threat of substitutes for OPAL Fuels Inc. is medium due to the availability of alternative energy sources such as solar and wind power.

Bargaining Power Of Customers

The bargaining power of customers for OPAL Fuels Inc. is low due to the lack of switching costs and the availability of alternative fuel sources.

Bargaining Power Of Suppliers

The bargaining power of suppliers for OPAL Fuels Inc. is high due to the concentration of suppliers in the market and the high switching costs.

Threat Of New Entrants

The threat of new entrants for OPAL Fuels Inc. is medium due to the high barriers to entry and the need for significant capital investment.

Intensity Of Rivalry

The intensity of rivalry for OPAL Fuels Inc. is high due to the high level of competition in the market and the need to differentiate products and services.

9. SWOT Analysis

Strength

Weaknesses

Opportunities

Threats

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

Value
Debt Weight -70.99%
Debt Cost 6.62%
Equity Weight 170.99%
Equity Cost 6.62%
WACC 6.62%
Leverage -41.52%

11. Quality Control: OPAL Fuels Inc. 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

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Northwest Natural

A-Score: 6.5/10

Value: 6.5

Growth: 3.2

Quality: 4.0

Yield: 8.0

Momentum: 7.0

Volatility: 10.0

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NiSource

A-Score: 6.3/10

Value: 5.0

Growth: 3.3

Quality: 4.7

Yield: 6.0

Momentum: 8.5

Volatility: 10.0

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Suburban Propane

A-Score: 6.2/10

Value: 6.4

Growth: 2.4

Quality: 5.1

Yield: 10.0

Momentum: 4.5

Volatility: 8.7

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Aris Water Solutions

A-Score: 6.0/10

Value: 6.0

Growth: 8.6

Quality: 4.7

Yield: 5.0

Momentum: 8.5

Volatility: 3.3

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RGC Resources

A-Score: 5.6/10

Value: 4.7

Growth: 3.6

Quality: 4.9

Yield: 8.0

Momentum: 6.5

Volatility: 6.0

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OPAL Fuels

A-Score: 4.5/10

Value: 9.7

Growth: 8.6

Quality: 5.1

Yield: 0.0

Momentum: 1.0

Volatility: 2.3

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

2.63$

Current Price

2.63$

Potential

-0.00%

Expected Cash-Flows