Another good news from Cloudberry today!

Carnegie:
Cloudberry Clean Energy (Buy): Another strong divestment at P/B >2.3x; shares trade at P/B 0.9x
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Cloudberry has entered into a divestment agreement with Cadre AS for the sale of three hydropower plants: Usma, Bjørgelva and Finnesettbekken. Cadre is owned by Nordkraft and HitecVision.
• Located in NO3 and NO4 with an annual power production of just below 36GWh.
• Transaction implies an EV of NOK320.5m and an equity value of NOK190.6m. Price implies an EV/GWh of NOK8.9m per GWh which is way above where the market is pricing Cloudberry’s portfolio at around NOK5-5.5m.
• This is also way above our SOTP of these assets. NOK320.6m vs our estimated EV of NOK167m
• Significant value creation once again with a sale price of >2.3x P/B resulting in an IRR of ~28% p.a. Cloudberry currently trade at a P/B just below 0.9x after having gained >30% since the bottom in April.
• Transaction will generate ~NOK205m in free cash for Cloudberry.
This transaction once again demonstrates Cloudberry's capability to generate value. We also believe it highlights that the true worth of its operational asset portfolio exceeds the current share price. Notably, Cloudberry also sold assets in the summer of 2023 at a P/B just above 2x. We have a BUY rating for Cloudberry with a target price of NOK12. However, our target price of NOK12 does not fully reflect the implied upside potential from doing further asset divestments.

Pareto and Sparebank both increase price targets for Cloudberry today

Sparebank:
CLOUD – 2Q Preview – BUY TP 14 (13.5): We reiterate our Buy recommendation and increase our target price to NOK14/share (from NOK13.5/share) ahead of CLOUD’s 2Q report. Our TP is mainly up due to the accretive hydro asset sale made by CLOUD in June.

Wave of upgrades on CLAUDBERRY:

DNB:
Backlog progressing as planned

The underlying Q3 results were slightly better than we expected on higher realised power prices and lower opex. Maturing its backlog seems to be progressing well, with a storage project and the Nees Hede solar project looking set for FID over the next quarters. We believe Cloudberry is fully funded for this and that future growth is likely to be partially financed by asset rotation. We have upgraded to BUY (HOLD) and maintain our NOK13 target price.

Backlog progressing according to plan. At the conference call, the company said it looks set to FID a storage project that utilises the grid connection originally secured for the Stenkalles offshore wind project in H1 2025. It is also progressing the Nees Hede (140MW net), where it has initiated procurement, and Duvhällen (60MW) projects. We understand that FID on Nees Hede could be over the next quarters
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Growth likely partly financed by asset rotation. The company guides for ~50% of capex to be financed by debt, and the rest by equity. We believe it should be fully financed to build the Nees Hede project, but on our estimates would need further funding to finance the equity portion of all three projects. We consider the most likely option for this to be asset rotation, either through divesting already operational assets or to finance part of the equity capex through farm-downs.
Upgraded to BUY and NOK13 target price reiterated, based on a combination of our DCF-based SOTP and recent asset transaction multiples. In our view, Cloudberry still needs to further crystallise the underlying values in its pipeline and development portfolio for a re-rating of the stock.

CLOUD financed ~50% of the acquisition with shares issued at NOK17/shares (vs 11nok share price) in line with our fair transaction value of the company

Last night, CLOUD announced that it had signed an agreement with Skovgaard Holding to acquire 160GWh of operating assets. The agreed enterprise value for the 160 GWh of producing assets is DKK 595m (equity value estimated to DKK 534m). The purchase price is below NOK 6 per kWh and aligns with Cloudberry’s current construction costs in the Nordics. Most importantly, we find it very positive that CLOUD financed ~50% of the acquisition with shares issued at NOK17/shares, in line with our fair transaction value of the company. The share issue represents a 50% premium to yesterday’s close and a gain of ~NOK170m for the 29.5m shares issued towards Skovgaard (seller