A Look at Boralex's (TSX:BLX) Valuation Following Latest Revenue Growth Report

Boralex (TSX:BLX) has recently caught investors’ attention after its latest quarterly results showed double-digit growth in annual revenue. However, the company still posted a net loss for the period. This financial performance has sparked renewed interest in the stock’s value.

See our latest analysis for Boralex.

Despite a surge in annual revenue, Boralex’s share price has not reflected the same optimism, with a 1-month share price return of -13.07% and a 1-year total shareholder return of -16.96%. Momentum has been fading recently, even as the company continues to expand its renewable energy footprint and report top-line growth.

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With Boralex trading at a steep discount to analyst targets while still posting losses, investors are left to wonder if this is a chance to buy into future growth at a bargain or if the market is already factoring in what lies ahead.

Most Popular Narrative: 33.7% Undervalued

Boralex's most widely followed valuation narrative places its fair value well above the last close. This suggests a significant disconnect between the recent share price and future projections. It also sets up an opportunity to examine what could drive such optimism among analysts and market-watchers.

Large increases in North American clean electricity demand, driven by government policy shifts such as Quebec's Bill 69 and Ontario's new procurement windows, are expected to create significant opportunities for Boralex to capture new PPAs and expand its asset base. This is likely to drive revenue and earnings growth through greater market share.

Read the complete narrative.

Wonder what transformative forces are fueling this bullish price target? Boralex’s projected leap in revenue, earnings, and margins could surprise even seasoned investors. Curious which headline assumptions unlock this large valuation gap? Explore the strategy that could affect the shares.

Result: Fair Value of $36.90 (UNDERVALUED)

Have a read of the narrative in full and understand what's behind the forecasts.

However, Boralex's heavy reliance on France and volatile weather could introduce revenue unpredictability. This may potentially undermine the bullish thesis on future earnings.

Find out about the key risks to this Boralex narrative.

Another View: What Do Key Ratios Reveal?

Looking at valuation from another angle, Boralex’s price-to-sales ratio stands at 3x. This is higher than the North American renewable energy industry average of 2.8x and its local peers’ average of 2.4x. However, it remains below the fair ratio of 3.7x that the market could move toward. This suggests that while Boralex appears expensive compared to others in the sector right now, there could be room for the stock to grow if the broader market reprices renewable names. Does this premium show hidden upside or extra risk?

See what the numbers say about this price — find out in our valuation breakdown.

Build Your Own Boralex Narrative

If these perspectives do not align with your own thinking, or if you want to dig into the numbers personally, the data is available for you to shape your own narrative in just a few minutes. Do it your way

A great starting point for your Boralex research is our analysis highlighting 3 key rewards and 2 important warning signs that could impact your investment decision.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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