Ormat Technologies, Inc. (ORA) stock analysis

P/E below its 5-year median

Ormat Technologies's P/E of 41.9 is below its own 5-year median of 50.6.

P/E above the industry

Ormat Technologies's P/E of 41.9 is above the Electric Services median of 21.0.

EV/EBITDA below its 5-year median

Ormat Technologies's EV/EBITDA of 10.5 is below its 5-year median of 12.3.

P/B above the industry

Ormat Technologies's price-to-book of 2.11 is above the Electric Services median of 2.01.

Trading below fair value

The share price of $90.45 is below our fair value estimate of $91.38.

Margin of safety under 20%

The price is 1.0% below fair value, less than the 20% cushion we look for.

Revenue growing 10%+ a year

Revenue grew 10.5% a year over the last three fiscal years.

EPS growing 10%+ a year

Diluted EPS grew 20.0% a year over the last three fiscal years.

Earnings growth not accelerating

Net income grew 0.8% over the last twelve months, against a 5-year average of 7.7% a year.

Growing faster than the industry

Revenue grew 28.6% over the last twelve months; the Electric Services median is 7.8%.

Guidance lowered

Ormat Technologies lowered its 2026 Energy Storage revenues outlook on Aug 5, 2026.

Gross margin improving

Gross margin was 28.4% over the last twelve months, against 28.3% a year earlier.

Return on equity under 15%

Return on equity was 5.2% over the last twelve months and averaged 4.6% over five years; we look for 15% on both.

Return on capital under 10%

Return on invested capital was 8.2%, below the 10% that usually covers the cost of capital.

Return on equity below the industry

Ormat Technologies's return on equity of 5.2% is below the Electric Services median of 8.3%.

Earnings grew over 5 years

Net income grew 7.7% a year on average over the last five fiscal years.

Net margin below its 5-year average

Net margin was 11.1% over the last twelve months, against a 5-year average of 12.0%.

Net margin above the industry

Ormat Technologies's net margin of 11.1% is above the Electric Services median of 8.8%.

Low debt

Debt is 3.8% of shareholders' equity, under the 40% we consider low.

Debt rising against equity

Debt to equity rose from 0.0% five years ago to 3.8%.

Debt covered by cash flow

Operating cash flow over the last twelve months equals 334% of total debt.

Interest not well covered

Operating income covers interest expense 1.2 times; we look for at least 5.

Short-term assets don't cover short-term debts

Current assets are 0.92 times current liabilities.

Elevated bankruptcy risk

The Altman Z-score is 1.31; above 3 is the safe zone and below 1.8 the distress zone.

Pays a dividend

Ormat Technologies paid dividends worth 0.5% of the share price over the last twelve months.

Yield below Treasuries

The 0.5% yield is below the 4.7% on a 1-year Treasury.

Yield below the top quarter

The top quarter of US dividend payers yield 3.8% or more; Ormat Technologies yields 0.5%.

Dividend was cut

The dividend per share fell by more than 10% at least once in the last 10 fiscal years.

Covered by earnings

Dividends take 21.8% of net income.

Cash-flow cover

Needs dividends paid and free cash flow.