European utilities and clean energy will have a lackluster performance in 2024, but Bernstein sees bright spots for the industry in the year ahead. “We are biased towards companies ramping up on the visible capex (capital expenditure) cycle of power grids,” analysts at the investment bank wrote in a Dec. 9 note. Here’s what Bernstein said on the topic Two of our top picks. EDP Renováveis Bernstein is bullish on Spanish renewable energy company EDP Renováveis and has a price target on the stock of 14.30 euros ($15), representing about 48% upside potential from Thursday’s levels. Analysts at the bank emphasized that “the stock price has overreacted to U.S. energy policy risks, providing an excellent opportunity to gain exposure to the company.” The energy industry has become the focus of attention as U.S. President-elect Trump has expressed a desire to reduce domestic energy costs. Looking ahead, analysts expect the U.S. to remain a key market for EDPR and offer “attractive growth opportunities in onshore wind and solar.” EDP’s shares are listed on Euronext Lisbon, Portugal, and trade in the United States as American depositary receipts under the symbol EDRVY. SSE Bernstein is also betting on energy company SSE, which it said “has many scarce but low-cost renewable energy growth options and is willing to wait patiently for the right opportunity.” Bernstein analysts noted that a key advantage of the company is that its “balance sheet is in a strong position to support growth.” They added that the company’s other strengths include providing “the best of both worlds for a network that enjoys explosive growth driven by huge investment demand and an improved regulatory outlook for UK power transmission, as well as benefiting from UK/Irish onshore and offshore wind project capacity” Expanding Renewable Energy Benefits”. SSE shares are listed on the London Stock Exchange and traded in the United States as American Depositary Receipts under the stock symbol SSEZY. Bernstein has a price target of 1,720 pence ($21.80) on the stock, about 8% above Thursday’s levels. UK shares trade in pennies. —CNBC’s Michael Bloom contributed to this report.
