Catalysts
- Structural market tailwinds: Offshore wind installations are projected to grow from approximately 8 GW in 2024 to 34 GW by 2030 (28% CAGR), supported by strong policy initiatives in the EU, U.S., and China targeting over 400 GW of capacity. Source.
- Fleet expansion: Cadeler operates 7 wind installation vessels as of mid-2025 and is on track to expand its fleet to 11 vessels by the end of 2027, enabling it to meet increasing global demand while also increasing utilization on existing fleet.
- Record-high order book: Cadeler has secured approximately €2.5 billion in contracts extending into 2029, offering high forward visibility in vessel utilization compared to cyclical oil and gas rig operators.
- ESG and contract model advantage: Cadeler benefits from multi-year, fixed-price contracts, access to green financing, and limited vessel supply—factors that position it more favorably than fossil-fuel rig peers exposed to volatile day-rate markets.
Assumptions
Revenue Growth Outlook
- 3-year CAGR (2021–2024): ~3% (coming from high growth territory)
- 5-year CAGR (2019–2024): ~33%
- 7-year CAGR (2017–2024 estimate): ~30%,
- Forward (2025–2029): A 25–30% CAGR remains a reasonable assumption based on industry growth, backlog, and fleet expansion. The base model assumes 27%, supported by strong backlog and fleet expansion.
Net Margin Outlook
- 3-year average (2022–2024): ~23%
- 5–7 year average (2020–2024): ~ negative 2%, reflecting early-stage losses
- Forward (2025–2029): With full fleet deployment and operational efficiency, margins are expected to stabilize at 27% (comparing with Factset estimates @ 33-40% margins). 27% is the assumption used in the model.
Risks
- Vessel non-performance or delivery delays: Newbuild delays or technical challenges could impact project execution or shift revenue recognition. However, Cadeler’s backlog-based contract model limits short-term exposure.
- Execution risk post-merger: The merger with Eneti increases operational scale but introduces integration and coordination challenges across fleets, systems, and geographies.
- Macroeconomic and policy volatility: Higher interest rates, inflation, and supply chain constraints—especially turbine delivery issues—could affect the pace of offshore wind deployments and the timing of revenue.
- Risk of new entrants, pushing down margins similar to those of traditional hydrocarbon rig operators.
Valuation Considerations
- A forward P/E multiple of 15x by 2029 is considered reasonable, reflecting Cadeler’s structural growth, ESG alignment, strong order book, and superior revenue visibility relative to traditional rig operators (6–9x).
- However, Cadeler remains an asset-heavy business with inherently low return on equity (ROE) and return on capital (ROC). As a result, a higher multiple than otherwise warranted by growth alone may not be justified.
To be on the lookout for
- Leverage, albeit unutilized facilities exist company gearing ratio has increased significantly from net debt/EBITDA 1.5 2022 to 4.2 2025.
- Management guidance on revenue growth, given high order backlog management projections should be decent.
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Disclaimer
The user Mandelman has a position in OB:CADLR. Simply Wall St has no position in any of the companies mentioned. Simply Wall St may provide the securities issuer or related entities with website advertising services for a fee, on an arm's length basis. These relationships have no impact on the way we conduct our business, the content we host, or how our content is served to users. The author of this narrative is not affiliated with, nor authorised by Simply Wall St as a sub-authorised representative. This narrative is general in nature and explores scenarios and estimates created by the author. The narrative does not reflect the opinions of Simply Wall St, and the views expressed are the opinion of the author alone, acting on their own behalf. These scenarios are not indicative of the company's future performance and are exploratory in the ideas they cover. The fair value estimates are estimations only, and does not constitute a recommendation to buy or sell any stock, and they do not take account of your objectives, or your financial situation. Note that the author's analysis may not factor in the latest price-sensitive company announcements or qualitative material.
