Scatec (OB:SCATC) Starts Shadwan Construction, Is The Stock Fully Priced?
Scatec (OB:SCATC) just moved a major project from blueprint to construction, breaking ground on the 900 MW Shadwan onshore wind farm in Egypt alongside EDF and securing a US$150 million equity bridge loan.
Scatec’s move on Shadwan lands after a sharp 5.53% 1-day share price return, feeding into a 9.36% 90-day gain. The board departure of Maria Tallaksen and other project updates come against a longer track record that shows momentum improving recently but mixed total shareholder returns over multi year periods.
Scan beyond Scatec and spot other renewable players with similar momentum by checking the hand picked 43 power grid technology and infrastructure stocks in the same segment of the energy transition.
Scatec now sits at an interesting crossroads. Is this jump a clear signal of improving project economics and funding, or a burst of renewed enthusiasm that the valuation section needs to test?
Most Popular Narrative: 20% Undervalued
Against the last close of NOK104, the most followed narrative pins Scatec's fair value at NOK129.89. This frames today's jump as part of a wider debate about how much of the project pipeline and margin story is already in the price.
The company's rapidly expanding growth portfolio, including a record-high backlog of 3.2 GW, an additional 2 GW under construction, and a pipeline of 7.7 GW of mature projects across multiple technologies and geographies, signals the potential for continued top-line growth and a doubling of installed capacity over the next two years, which would positively impact future revenues. Continued reduction in corporate debt and strengthening of the balance sheet, with a clear deleveraging strategy, enhanced capital efficiency, and improved financial flexibility, lowers financial risk and creates capacity for self-funded growth, supporting strong net margins and earnings stability.
See why 15 investors see Scatec as 20% undervalued.
Result: Fair Value of NOK129.89 (UNDERVALUED)
Still, any renewed supply chain issues or shifts in government support for long term power contracts could quickly challenge the bullish Scatec narrative that investors are leaning on.
Find out about the key risks to this Scatec narrative.
Another View: Scatec Through The P/S Lens
The fair value story built around Scatec talks about NOK129.89 per share. On simple P/S math, the picture looks less forgiving. The stock trades around 4.3x sales compared with about 2.3x for the wider European renewable group, yet still below a peer average near 11.5x and a fair ratio estimate of 11.2x.
That gap suggests the market already pays a premium to the sector but still applies a discount to what similar businesses and the fair ratio imply, which raises a practical question for you as an investor. Does this pricing reflect justified caution on Scatec's project and funding risks, or potential upside if its growth story plays out as forecasts suggest?
See what the numbers say about this price — find out in our valuation breakdown.
Next Steps
Mixed signals on Scatec, with both risks and rewards in play, mean the next move is yours: weigh the data carefully and stress test the 2 key rewards and 1 important warning sign.
Looking For More Investment Ideas Beyond Scatec?
If Scatec has your attention, do not stop there. Broader ideas now can mean better choices when the next opportunity lands in front of you.
- Target resilient cash generators and stress test your downside risk profile with the list of solid balance sheet and fundamentals (204 results).
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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
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