Jefferies Downgrades Ormat to Hold Amid Valuation Concerns
Written by Emily J. Thompson, Senior Investment Analyst
Updated: 2 days ago
0mins
Should l Buy ORA?
Source: seekingalpha
- Rating Downgrade: Jefferies has downgraded Ormat (ORA) from Buy to Hold with a price target of $130, believing that the current stock price already reflects much of the upside potential from enhanced geothermal systems and data centers.
- Long-Term Outlook Positive: Analyst Julien Dumoulin-Smith remains bullish on Ormat's long-term trajectory, citing rising U.S. demand for baseload power as a driver for geothermal expansion, but he finds the current valuation challenging as value shifts towards the development platform.
- Lack of Near-Term Catalysts: While Ormat's shares have performed strongly through 2025, the analyst sees few near-term catalysts to drive incremental upside, particularly as enhanced geothermal system technology remains hypothetical and execution lags behind 2028 capacity targets.
- Data Center Contract Impact: Although additional data center contracts could drive shares higher in the coming months, Dumoulin-Smith believes that Ormat's 250 MW data center opportunity is already reflected in the current valuation.
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Analyst Views on ORA
Wall Street analysts forecast ORA stock price to fall
8 Analyst Rating
6 Buy
2 Hold
0 Sell
Strong Buy
Current: 120.400
Low
111.00
Averages
120.00
High
135.00
Current: 120.400
Low
111.00
Averages
120.00
High
135.00
About ORA
Ormat Technologies, Inc. is a geothermal and vertically integrated company engaged in geothermal and recovered energy generation (REG). The Company owns, operates, designs, manufactures and sells geothermal and REG power plants primarily based on the Ormat Energy Converter, a power generation unit that converts low-, medium- and high-temperature heat into electricity. The Company has engineered, manufactured and constructed power plants, which it owns or has installed for utilities and developers worldwide, totaling approximately 3,400 megawatts (MW) of gross capacity. Its segments include Electricity Segment, Product Segment and Energy Storage Segment. Its Electricity segment develops, builds, owns and operates geothermal, solar PV and recovered energy-based power plants in the United States and geothermal power plants in other countries around the world. Product segment designs, manufactures, and sells equipment for geothermal and recovered energy-based electricity generation.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
Jefferies Downgrades Ormat to Hold Amid Valuation Concerns
- Rating Downgrade: Jefferies has downgraded Ormat (ORA) from Buy to Hold with a price target of $130, believing that the current stock price already reflects much of the upside potential from enhanced geothermal systems and data centers.
- Long-Term Outlook Positive: Analyst Julien Dumoulin-Smith remains bullish on Ormat's long-term trajectory, citing rising U.S. demand for baseload power as a driver for geothermal expansion, but he finds the current valuation challenging as value shifts towards the development platform.
- Lack of Near-Term Catalysts: While Ormat's shares have performed strongly through 2025, the analyst sees few near-term catalysts to drive incremental upside, particularly as enhanced geothermal system technology remains hypothetical and execution lags behind 2028 capacity targets.
- Data Center Contract Impact: Although additional data center contracts could drive shares higher in the coming months, Dumoulin-Smith believes that Ormat's 250 MW data center opportunity is already reflected in the current valuation.
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Jefferies Downgrades ORMAT TECHNOLOGIES INC to Hold from Buy; Increases Target Price to $130 from $125
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Ormat Technologies (ORA) Invests $25M in Sage Geosystems' $97M Series B Funding
- Investment Strategy: Ormat Technologies announces a $25 million equity investment in Sage Geosystems, participating in its $97 million Series B funding round aimed at addressing the surging electricity demand driven by artificial intelligence.
- Technology Pilot: Sage plans to pilot its Pressure Geothermal technology at an existing Ormat power plant, with the goal of extracting geothermal heat from hot dry rock to accelerate the market introduction of next-generation geothermal solutions.
- Development Rights: Upon successful completion of the pilot, Ormat will have the right to develop, build, own, and operate geothermal power plants and energy storage projects utilizing Sage's technology, thereby enhancing its market position in renewable energy.
- Market Potential: Although geothermal energy currently meets only a small fraction of U.S. power demand, the Department of Energy projects that next-generation systems could provide up to 120 GW of capacity by 2050, enough to power 90 million homes.
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Jefferies Downgrades Ormat to Hold Amid Valuation Concerns
- Rating Downgrade: Jefferies has downgraded Ormat (ORA) from Buy to Hold with a price target of $130, believing that the current stock price already reflects much of the upside potential from enhanced geothermal systems and data centers.
- Long-Term Outlook Positive: Analyst Julien Dumoulin-Smith remains bullish on Ormat's long-term trajectory, citing rising U.S. demand for baseload power as a driver for geothermal expansion, but he finds the current valuation challenging as value shifts towards the development platform.
- Lack of Near-Term Catalysts: While Ormat's shares have performed strongly through 2025, the analyst sees few near-term catalysts to drive incremental upside, particularly as enhanced geothermal system technology remains hypothetical and execution lags behind 2028 capacity targets.
- Data Center Contract Impact: Although additional data center contracts could drive shares higher in the coming months, Dumoulin-Smith believes that Ormat's 250 MW data center opportunity is already reflected in the current valuation.
See More
Clean Energy Sector Thrives Despite Challenges in 2025
- Clean Energy Resilience: Despite rising interest rates and inflationary pressures, the clean energy sector thrived in 2025, with solar stocks emerging as major winners, indicating strong market demand for renewable energy.
- Clearway Energy's Strong Performance: Clearway Energy Group (NYSE:CWEN) attracted investor attention due to its diversified asset portfolio and high dividend yield, with its stock crossing above the 50-day moving average in January, demonstrating robust upward momentum.
- NextPower Buyback Announcement: NextPower announced a $350 million share buyback, prompting several analysts to raise their price targets, with UBS setting a Street-high target of $140, reflecting over 20% upside from current market prices and confidence in future growth.
- Bloom Energy's Surging Orders: Bloom Energy's fuel cell systems have become critical in the AI data center buildout, with a backlog exceeding $20 billion, and management raised 2026 guidance to $3.3 billion following its Q4 2025 report, showcasing strong market demand.
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Jefferies Downgrades ORMAT TECHNOLOGIES INC to Hold from Buy; Increases Target Price to $130 from $125
- Company Update: Ormat Technologies has cut its hold from buy to hold.
- Target Price Adjustment: The target price for Ormat Technologies has been raised to $130 from $125.
See More
Energy Companies Supported by Jeff Bezos and Bill Gates Aim for IPO
- Public Offerings: Two novel energy companies have filed for initial public offerings (IPOs), allowing investors to participate in emerging trends in electricity generation.
- Future Impact: These companies aim to reshape the electricity generation landscape over the next decade, contingent on their success.
See More
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- Oklo's Popularity: Oklo is gaining attention as a notable nuclear stock, attracting both interest and scrutiny from investors.
- Commercial Uncertainty: There are ongoing uncertainties regarding Oklo's journey towards commercial viability.
- Recent Developments: A recent development has emerged that may alleviate some of the concerns held by investors.
- Investor Sentiment: The combination of popularity and uncertainty highlights the complex sentiment surrounding Oklo in the market.
See More
Ormat Technologies (ORA) Invests $25M in Sage Geosystems' $97M Series B Funding
- Investment Strategy: Ormat Technologies announces a $25 million equity investment in Sage Geosystems, participating in its $97 million Series B funding round aimed at addressing the surging electricity demand driven by artificial intelligence.
- Technology Pilot: Sage plans to pilot its Pressure Geothermal technology at an existing Ormat power plant, with the goal of extracting geothermal heat from hot dry rock to accelerate the market introduction of next-generation geothermal solutions.
- Development Rights: Upon successful completion of the pilot, Ormat will have the right to develop, build, own, and operate geothermal power plants and energy storage projects utilizing Sage's technology, thereby enhancing its market position in renewable energy.
- Market Potential: Although geothermal energy currently meets only a small fraction of U.S. power demand, the Department of Energy projects that next-generation systems could provide up to 120 GW of capacity by 2050, enough to power 90 million homes.
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