This is Our Earth Day Stock of the Week

VIDEO: Denmark's Orsted is looking at new markets to keep its growth going

James Gard 21 April, 2022 | 9:14AM
Facebook Twitter LinkedIn



For our Earth Day coverage this week, our latest stock video looks further afield to Scandinavia. The region hosts a large number of sustainable companies, with many of these clustered in Sweden and Denmark. We could mention Sweden’s Vattenfall, Danish wind turbine manufacturer Vestas, or even Copenhagen-based electric car sharing firm GreenMobility. But today we’re going to talk about Orsted, Denmark’s largest energy company and the world’s dominant supplier of offshore wind power. It also builds and operates onshore wind farms, solar farms and hydrogen facilities.

Orsted shares had an amazing run in 2020 as ESG companies were revalued by investors but they have struggled to maintain momentum since. Our energy analyst Tancrede Fulop says this leaves the shares materially undervalued, especially given the prospects for offshore wind this decade. Morningstar expects the offshore wind market to be eight times larger in 2030 than in 2020.

Orsted has strong know-how in this sector and has used its first-mover advantage to build a dominant market share. But offshore wind is starting reach saturation point in Europe particularly as subsidies are waning, so Orsted is focusing on onshore wind and solar energy, as well as new markets. The United States is a key market for the company, as well as the UK, Germany and of course Denmark.

What are the risks going forward? The resurgence of fossil fuels and nuclear energy since the start of the Ukraine war could mean renewable energy growth rates are harder to sustain. Higher inflation and interest rates are likely to increase costs and reduce the return from projects.

For Morningstar, I’m James Gard.


The information contained within is for educational and informational purposes ONLY. It is not intended nor should it be considered an invitation or inducement to buy or sell a security or securities noted within nor should it be viewed as a communication intended to persuade or incite you to buy or sell security or securities noted within. Any commentary provided is the opinion of the author and should not be considered a personalised recommendation. The information contained within should not be a person's sole basis for making an investment decision. Please contact your financial professional before making an investment decision.

Facebook Twitter LinkedIn

About Author

James Gard

James Gard  is senior editor for


© Copyright 2024 Morningstar, Inc. All rights reserved.

Terms of Use        Privacy Policy        Modern Slavery Statement        Cookie Settings        Disclosures