Jefferies Downgrades Ormat to Hold Amid Valuation Concerns
Written by Emily J. Thompson, Senior Investment Analyst
Updated: Feb 13 2026
0mins
Should l Buy ORA?
Source: seekingalpha
Ormat Technologies Inc (ORA) saw a price increase of 5.03% as it crossed above the 5-day SMA, despite the broader market decline with Nasdaq-100 down 1.16% and S&P 500 down 0.66%.
Jefferies has downgraded Ormat from Buy to Hold, raising the price target to $130. Analyst Julien Dumoulin-Smith remains optimistic about Ormat's long-term prospects due to rising U.S. demand for baseload power, but he notes that the current valuation reflects much of the potential from enhanced geothermal systems. He also mentions a lack of near-term catalysts, although additional data center contracts could provide some upside.
The downgrade reflects concerns about valuation, but the long-term outlook remains positive. Investors may want to monitor upcoming developments in the clean energy sector, particularly regarding data center contracts that could influence Ormat's stock performance.
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Analyst Views on ORA
Wall Street analysts forecast ORA stock price to rise
8 Analyst Rating
6 Buy
2 Hold
0 Sell
Strong Buy
Current: 110.840
Low
111.00
Averages
120.00
High
135.00
Current: 110.840
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.
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- Dual Voting Rights Policy: Under Article L.22-10-46 of the French Commercial Code, fully paid-up shares held for over two years automatically receive double voting rights, aimed at enhancing the influence of long-term shareholders and promoting better corporate governance.
- Voting Rights Exercised: As of January 31, 2026, the number of exercisable voting rights stood at 3,178,937,422, indicating active shareholder participation in corporate governance, which may impact future decision-making transparency and efficiency.
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- Long-Term Agreements: The long-term power purchase agreement with Switch and the development/PPA deal with NV Energy/Google demonstrate Ormat's capability to provide 24/7 clean baseload power, further solidifying its position in the data center market.
- Price Uptrend: Driven by robust energy demand and hyperscaler commitments to clean energy, geothermal PPA prices have risen to over $100/MWh, and RBC analysts believe this will provide ongoing economic support for Ormat moving forward.
- Future Outlook: Analysts expect economic upside from the re-contracting of existing PPAs between 2029-34 and from new agreements that will support the expansion and development of new geothermal projects, enhancing Ormat's growth trajectory in the renewable energy sector.
See More
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- Operational Efficiency Improvement: By integrating Tech Mahindra's delivery capabilities with Orange Business's unique positioning, both companies will accelerate automation processes and enhance operational efficiency, thereby providing greater value to global customers.
- Support for Digital Transformation: This partnership will complement the ongoing digital transformation at Orange Business, reinforcing its leadership in global secure connectivity and enabling enterprises to achieve rapid growth in an increasingly connected world.
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- New Project Advancements: The company successfully commissioned the Arrowleaf project in California, acquired the Hoku project in Hawaii, and won a geothermal tender in Indonesia, which are expected to provide robust support for future revenue growth, particularly through long-term power purchase agreements with Google and Switch.
- Optimistic Future Outlook: Ormat projects 2026 revenue between $1.11 billion and $1.16 billion, representing a 14.6% increase at the midpoint compared to 2025, with adjusted EBITDA anticipated to rise to a range of $615 million to $645 million, reflecting strong momentum in geothermal development and energy storage.
- Capital Expenditure Plans: The company expects total capital expenditures of $675 million for 2026, and following the sale of its Topp 2 plant in New Zealand, the net investment is projected to be around $575 million, which will provide funding for future project expansions and technological investments.
See More
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- Shift to Developed Markets: Over the past year, there has been a noticeable trend of moving investments into other developed markets as a strategy for risk management.
- AI-Related Equities Impact: The recent volatility in AI-related equities in the U.S. has further motivated investors to seek alternative investment opportunities.
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