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Analysis before buying or selling Neoen shares

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If you are considering trading Neoen shares or buying the stock to add to your portfolio, you should first get to know the company and its direct economic environment. On this page we will present you with the data you will need for this analysis, such as a complete presentation of the company and its activities and sources of income, a presentation of its main competitors on the market and its recent partnerships, its strengths and weaknesses as well as the elements to be taken into account in your fundamental analysis.

Elements to consider before selling or buying Neoen shares

Analysis N°1

Whether or not the objectives of the medium-term strategic plans are achieved. Currently, the company's roadmap foresees the deployment in Europe of diversity units with a rigorous cost reduction policy of around 24 million euros and a control of Capex between 3 and 5%.

Analysis N°2

Innovation is also at the heart of Neoen's success and it will therefore be important to follow closely the investments made in R&D and the new solutions developed by the company.

Analysis N°3

We will also have to keep an eye on the group's environmental strategy, which is based on two pillars: reducing the carbon footprint internally and broadening the offer to customers.

Analysis N°4

The group's operations aimed at boosting the most profitable activities should also be closely monitored, particularly with regard to the lithium ion battery storage that it is currently developing in partnership with the Tesla group at the Australian unit in Hornsdale, and the completion of a portfolio of wind energy projects in Australia and France.

Analysis N°5

It will of course be necessary to follow closely the competition of this company and the news of the various players in this sector of activity.

Analysis N°6

Finally, it is of course important to keep an eye on the company's financial results every year and every quarter.

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General presentation of Neoen

Let us now find out a little more about Neoen. It is important to understand what the company does and how it generates its profits in order to understand how it can develop in the long term.

The Neoen Group is a French company operating in the energy sector. More specifically, the company is a leading independent producer of renewable energy as it is the largest independent producer of electricity from renewable energy in France. Its activity is focused on the production of solar and wind energy, but also on the development of advanced energy storage solutions.

Geographically, Neoen is present in three different areas with Europe and Middle East Africa including France, Portugal and Ireland, Australia and the Americas with El Salvador, Mexico, Jamaica, Argentina and the USA.

The Neoen Group currently owns and operates photovoltaic and wind power plants with a combined installed capacity of 4,051 MW in operation and under construction, of which 515 MW are energy storage plants. Of this total capacity, 2,557 MW are from photovoltaic installations and 979 from wind power installations.

Analysis before buying or selling Neoen shares
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The major competitors of Neoen

Now that you are familiar with Neoen and its activities, we would like to tell you a little more about its sectoral environment. We are now going to look at the company's direct competitors, which can hinder its market share and which you should therefore include in your analysis.

Engie 

This French group is the third largest in the energy sector and is partly owned by the French state. Engaged in energy transition and digital technology for several years, it employs 158,505 people and is listed on the CAC 40 index.

Enel 

The Enel Group is an Italian company and the country's main electricity producer. It is also the largest producer of geothermal energy in the world, with 32 power plants in Italy and around 20 in the rest of the world. It also operates photovoltaic plants in Italy.

Iberdrola 

The Spanish company Iberdrola is also a competitor of Neoen and specialises in the production, distribution and sale of electricity and natural gas. It is one of the most important players in this sector worldwide and the leader in wind power production. It is present in ten countries and employs more than 30,000 people. The company is listed on the Madrid stock exchange and is part of the Ibex 35 stock market index.

EDF 

Finally, the French company EDF, also partly owned by the state, is the leading producer and supplier of electricity in France and Europe.


The major partners of Neoen

Of course, as part of its strategy, the Neoen Group also regularly sets up strategic partnerships with other companies, as we will see with these two specific examples.

Tesla 

First and foremost and in 2020, this renewable energy producer has established a strategic partnership with the American company Tesla in Australia. The aim of this partnership is to build a new giant battery in Australia, designed jointly by the two companies. This battery will be based on a number of technological innovations with the aim of ensuring that Victoria's electricity network operates more efficiently and thus promoting the development of renewable energy. Indeed, Australia has great potential due to its high level of sunshine, and this battery is intended above all to replace several ageing coal-fired power stations that will be shut down in the coming decades. According to a study, renewable energies should account for more than 75% of the country's electricity demand before 2025.

Engie

Another strategic partnership that Neoen set up in 2021 was with the French company Engie. The two companies have joined forces to create Horizeo, a renewable energy production project based on the novel concept of a low-carbon energy platform in Gironde. The project also includes a 1GW photovoltaic park with storage and a green hydrogen production unit with an estimated cost of over one billion euros. Its objective is to develop a new renewable energy production model with a 1GW photovoltaic park to produce electricity equivalent to the annual consumption of more than 600,000 people and complementary technological building blocks.

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Positive factors for Neoen shares
The factors in favour of a rise in the Neoen share price:

In order to be able to anticipate future changes in the Neoen share price, you need to know the strengths and weaknesses of the company. In other words, you need to know which strengths can help the company to grow in the coming years and which elements can hinder this growth.

Let's start this analysis with a summary of the different strengths of Neoen that may encourage investors to buy this stock:

  • Firstly, the company's positioning in certain segments of its business is noteworthy. This concerns in particular the fact that the company is the leading French producer of renewable energy in solar and wind power.
  • The company's strong international presence is also one of its main assets. Indeed, the group achieves its turnover in almost 14 countries around the world.
  • It is also worth noting the good visibility offered on the group's activity with an integrated develop-to-own business model.
  • Among the advantages of Neoen, it should be noted that the group is present in all phases of the life of the assets with development, financing, project management and operations. In addition, it owns almost 85% of the power plants.
  • On the purely financial side, it is also worth noting that the company's balance sheet is particularly strong with long-term debt in the high investment grade and a rating of A.
Negative factors for Neoen shares
The factors in favour of a drop in the Neoen share price:

But of course, the Neoen Group does not only have advantages. It also has some weak points that you should be aware of before taking a position on this stock:

  • First of all, European regulation has a significant impact on the group's activities because it hinders traditional market players who are competing in particular with options, OTC technical platforms that operate outside market rules and direct corporate financing.
  • The group's operating costs also remain very high at present and since the end of 2020, and may therefore hamper the medium and long-term profitability of this company.
  • Finally, Neoen's stated objectives are particularly ambitious and may be difficult to achieve.
The information supplied here is only for indicative purposes and should not be used without the completion of a comprehensive and complete fundamental analysis of this asset notably taking into account exterior data, future publications and announcements and all fundamental events and news that could influence the strengths and weaknesses or make them more or less significant. This information does not in any way constitute recommendations relating to the completion of transactions or a solicitation to buy or sell an asset.

Frequently Asked Questions

How are Neoen's activities divided?

Neoen's activities are divided between solar energy, wind energy and energy storage. Solar energy currently generates almost half of the group's turnover. It is also important to note that the company is active all over the world, but mainly in Europe, Australia, America and Africa, and that its production is spread over 14 different countries.

When and how did Neoen's IPO take place?

On 16 October 2018, Neon went public with the subscription of its historical shareholders. The IPO raised more than €697 million, including €450 million in equity, including the over-allotment option. The group thus became the first young French company in this sector to exceed a billion euros in capitalisation. Subsequently and in 2019, it sold its only biomass unit.

Which indicators should be used to analyse the Neoen share?

To set up a good analysis of the Neon share price, you must take into account the signals obtained through both fundamental and technical analysis. Indeed, you will first carry out a study of the most impactful events and publications and then an analysis of the technical and graphic indicators of this stock.

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