Spanish renewable energy firms shares decline on regulatory uncertainty
(ADPnews) - Oct 5, 2010 - The shares of the main Spanish green energy companies have slumped since the start of the year mainly on regulatory uncertainties in Spain.
Gamesa (MCE:GAM) has crashed by 55.36%, followed by Acciona (MCE:ANA) which has dipped by 33.41%, according to data of Bloomberg. Iberdrola Renovables (MCE:IBR) has lost 28.31% and Abengoa (MCE:ABG) has declined by 17.35%. Gamesa's price earnings (P/E) ratio stood at 17.71, while this of Abengoa came in at 9.01. The P/E ratio of Acciona and Iberdrola Renovables is over 26.
The renewable energy sector is highly dependent on state aid and needs clear regulations but in Spain the regulatory uncertainty on the state subsidies has affected the companies. It will be difficult to have new regulation in the short term, Ivan San Felix, an analyst from Renta 4, said. The lack of clear rules in the country may lead to additional pressure on the sector players.
The Spanish renewable energy firms have increased its presence abroad searching for more stability. Gamesa has signed contracts in China, while Abengoa and Iberdrola Renovables have focused on the USA.
Abengoa opened today at EUR 18.625, down 0.29%, and Acciona traded at EUR 60.70 inching up by 0.07%. Iberdrola Renovables stood flat at EUR 2.38, while Gamesa opened at EUR 5.176, down 0.12%.
(EUR 1.0 = USD 1.368)