March 19 (Bloomberg) -- Vestas Wind Systems A/S, the biggest maker of wind turbines, climbed to a six-week high in Copenhagen after Danske Bank A/S recommended buying the shares, saying investor concerns about demand and the impact of a mooted rights offer are “overdone.”
Vestas, based in Aarhus, Denmark, gained as much as 3.8 percent to 66.35 kroner, the highest since Feb. 7, and traded at 65.50 kroner as of 1:56 p.m. local time, making it the biggest gainer on the benchmark OMX Copenhagen 20 Index today.
“The industry outlook is still mixed but not deteriorating to the extent the share price discounts,” Danske Markets, a unit of Danske Bank, said in a note to clients. Investor concerns about a possible rights issue are also “overdone,” the brokerage said.
Shares in Vestas have fallen 91 percent from a record in September 2008 as turbine prices dropped on excess capacity and competition from Chinese manufacturers including Sinovel Wind Group Co. and Xinjiang Goldwind Science & Technology Co.
Turbine contracts signed in the second half of 2011 for delivery in 2013 fell 4 percent to 910,000 euros ($1.2 million) a megawatt compared with the previous six months, the lowest since at least 2008, according to a Bloomberg New Energy Finance report on March 6.
Danske Markets, which had previously had a “bearish view” on Vestas because of concerns about regulation, excess supply and falling prices, resumed coverage of the stock today with a buy recommendation and an 80 kroner ($14.16) target price.
Vestas has won an order for 25 V90, 2-megawatt turbines from China’s Longyan, it said earlier today.
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