We recently issued an updated research report on Ormat Technologies Inc. (ORA - Free Report) . The company registered third-quarter 2018 adjusted earnings of 31 cents per share, which missed the Zacks Consensus Estimate of 44 cents by 29.6%. Earnings also declined 39.2% from the prior-year quarter.
Ormat Technologies bears a solid opportunity to expand in the global geothermal energy market, which according to the GEA’s Geothermal Power: International Market Update is expected to grow from 13.8 gigawatts (GW) in 2017 to 23 GW by 2021.
What’s Driving the Stock?
Ormat Technologies already enjoys an established geothermal market in the countries of Honduras, Mexico and Indonesia and is lately expanding its footprint in nations like China, New Zealand and the Philippines.
The company has shifted its focus to developing Solar PV power plants in locations where it can offer competitively priced power generation. This is because the market for Solar PV power has grown significantly in recent years, driven by a combination of favorable government policies and decline in equipment prices.
Furthermore, the developing global energy storage market offers the company significant opportunities to expand. This is evident as Ormat Technologies acquired Virdity Energy last year to accelerate long-term growth, expand market presence, and further develop its energy storage, demand response and energy management services.
However, Ormat Technologies' international operations expose the company to risks related to the application of foreign laws, taxes, economic conditions, labor supply and relations, political conditions, and policies of foreign governments. Such macro scale risks may adversely affect the company’s ongoing business, financial condition and cash flows.
Estimates for Ormat Technologies have been revised downward over the past 30 days. The company’s earnings surpassed the Zacks Consensus Estimate only once in the trailing four quarters, average being 10.86%.
Ormat Technologies, Inc. Price and Consensus