Value
4.4/10data confidence 100%| Component | Sub-score |
|---|---|
| P/E | 2.8 |
| P/S | 7.1 |
| EV/EBITDA | 2.1 |
| Fwd P/E | 3.0 |
| PEG | 3.5 |
| Analyst target | 7.5 |
- ▸Forward P/E: 35.7x
- ▸PEG: 3.40
ORA · Why this verdict
Why Ormat Technologies (ORA) is rated SELL
Updated
Model-generated analysis — not investment advice. Not a registered investment advisor. Past performance does not guarantee future results. How we score · Editorial policy
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VerdictSELL
Overall score4.5/10
ConfidenceMEDIUM
MacroNEUTRAL
TrendMatrix Research · core thesis
Engine thesis — one sentence
Ormat has a perfect four-quarter earnings beat streak and notable analyst upside after a 40% drawdown, but negative free cash flow, high leverage and a 70% electricity segment concentration keep quality below the floor.
Falsifiable statement — pillar-level invalidators below. Engine-derived; not personalized advice.
Thesis pillars
| Pillar | Expectation | Trend |
|---|---|---|
Ormat has beaten EPS estimates in 4 of 4 recent quarters with an average surprise of 37.2%, including $0.50 versus $0.26 last quarter. Earnings | EPS keeps beating consensus, including the report due in 11 days. | →Stable |
| CounterEstimates for a capital-intensive utility may be set conservatively, and beats have not translated into stock performance given the 40% drawdown. | ||
Earnings quality is flagged as a red flag with FCF to net income of -251%, and free cash flow is negative alongside D/E of 5.3. Quality breakdown | Free cash flow stays negative while heavy capital spending continues, keeping leverage high. | →Stable |
| CounterNegative free cash flow in renewable developers often reflects growth capex that later produces contracted revenue, so it is not necessarily a sign of distress. | ||
The Electricity segment makes up 70.1% of the business, leaving results tied to one product line and its power-purchase terms. Bear case | Segment mix stays near 70% and results track electricity output over the next 12 months. | ↓Deteriorating |
| CounterConcentration in contracted electricity sales can mean predictable, utility-like revenue rather than volatile exposure. | ||
The stock is 40% below its 52-week high in a death cross with improving MACD and RSI of 41, while the 200-day average is still falling 2.7% per 30 days. Chart pattern detection | MACD keeps improving and price retakes the 200-day average within the next two quarters. | →Stable |
| CounterThe moving-average slope still shows a confirmed downtrend and an elevated put/call ratio of 9.35 suggests the market is positioned for further declines. | ||
The $107.52 analyst target is 23.5% above the $87.09 price, with raw analyst upside noted at 42%, against 6.1% downside to the stop. Upside pct | Price moves toward the analyst target as earnings continue to beat. | →Stable |
| CounterA forward P/E of 33.9x and a PEG of 3.59 mean the stock is not cheap, so analyst targets may prove too optimistic. | ||
Ormat has beaten EPS estimates in 4 of 4 recent quarters with an average surprise of 37.2%, including $0.50 versus $0.26 last quarter.
→StableEarnings
- Expectation
- EPS keeps beating consensus, including the report due in 11 days.
CounterEstimates for a capital-intensive utility may be set conservatively, and beats have not translated into stock performance given the 40% drawdown.
Earnings quality is flagged as a red flag with FCF to net income of -251%, and free cash flow is negative alongside D/E of 5.3.
→StableQuality breakdown
- Expectation
- Free cash flow stays negative while heavy capital spending continues, keeping leverage high.
CounterNegative free cash flow in renewable developers often reflects growth capex that later produces contracted revenue, so it is not necessarily a sign of distress.
The Electricity segment makes up 70.1% of the business, leaving results tied to one product line and its power-purchase terms.
↓DeterioratingBear case
- Expectation
- Segment mix stays near 70% and results track electricity output over the next 12 months.
CounterConcentration in contracted electricity sales can mean predictable, utility-like revenue rather than volatile exposure.
The stock is 40% below its 52-week high in a death cross with improving MACD and RSI of 41, while the 200-day average is still falling 2.7% per 30 days.
→StableChart pattern detection
- Expectation
- MACD keeps improving and price retakes the 200-day average within the next two quarters.
CounterThe moving-average slope still shows a confirmed downtrend and an elevated put/call ratio of 9.35 suggests the market is positioned for further declines.
The $107.52 analyst target is 23.5% above the $87.09 price, with raw analyst upside noted at 42%, against 6.1% downside to the stop.
→StableUpside pct
- Expectation
- Price moves toward the analyst target as earnings continue to beat.
CounterA forward P/E of 33.9x and a PEG of 3.59 mean the stock is not cheap, so analyst targets may prove too optimistic.
Per-dimension breakdown
Quality
3.2/10data confidence 100%| Component | Sub-score |
|---|---|
| ROE | 1.6 |
| ROA | 1.4 |
| Gross margin | 1.6 |
| Op margin | 5.4 |
| Net margin | 5.3 |
| Current ratio | 4.1 |
| FCF quality | 0.0 |
| Moat | 4.9 |
| Piotroski F | 4.4 |
- ▸Earnings quality RED FLAG: -251% FCF/NI
- ▸No competitive moat
Growth
3.0/10data confidence 67%| Component | Sub-score |
|---|---|
| Rev growth | 5.2 |
| EPS growth | 0.7 |
Momentum
4.7/10data confidence 100%| Component | Sub-score |
|---|---|
| RSI | 4.5 |
| MACD | 10.0 |
| OBV | 1.0 |
| MA position | 4.0 |
| Volume | 3.9 |
- ▸Volume distribution (falling OBV)
- ▸Below 200-MA, MA slope -2.8%/30d — confirmed downtrend
Sentiment
7.7/10data confidence 100%| Component | Sub-score |
|---|---|
| LLM sentiment | 7.4 |
| Analyst rating | 7.1 |
| Price target | 8.9 |
- ▸LLM news sentiment: +0.48 (n=2)
- ▸Analyst upside: 35%
Insider
5.3/10data confidence 75%| Component | Sub-score |
|---|---|
| materiality | 5.0 |
| holder change | 5.8 |
| notable moves | 5.0 |
- ▸No net insider activity — $0 (0.000% of mkt cap)
Peer rank
4.1/10data confidence 80%| Component | Sub-score |
|---|---|
| value rank | 2.3 |
| quality rank | 6.3 |
| growth rank | 3.6 |
Technical
3.4/10data confidence 100%| Component | Sub-score |
|---|---|
| bollinger | 2.5 |
| support resistance | 2.6 |
| 52w position | 2.5 |
| gap | 6.0 |
Risk (lower is worse)
4.3/10data confidence 100%| Component | Sub-score |
|---|---|
| short interest | 4.4 |
| days to cover | 3.6 |
| volatility | 5.0 |
| put call | 0.0 |
| implied vol | 5.0 |
| beta | 7.6 |
| debt equity | 4.5 |
- ▸Elevated put/call: 8.87
- ▸Concentration risks: 1 HIGH, 1 MED (10-K Item 1A — sized via position_sizing, validated via buy_confidence)
Catalyst
7.0/10data confidence 100%| Component | Sub-score |
|---|---|
| erm | 6.5 |
| earnings history | 10.0 |
| earnings timing | 5.0 |
| surprise avg | 10.0 |
| dividend safety | 4.3 |
| news activity | 6.0 |
- ▸Perfect beat streak: 4Q
- ▸Earnings in 6 days
- ▸Yield trap warning: high yield but unsafe
How the verdict was assembled
Engine trigger
Quality below minimum threshold.
Engine technical detail
verdict_path:
L1:HARD_BLOCK:QUALITY_FLOORPassed (7)
- MOMENTUM:4.7>=4.5
- ASYMMETRY:2.7>=1.5
- INSIDER:OK
- 8K:CLEAN
- NEWS_BOOST:EARNINGS:0.70
- SEMI_CYCLE_PEAK:CLEAR
- MATERIALS_CYCLE_PEAK:CLEAR
Failed (2)
- DEATH_CROSS:HARD_BLOCK
- EARNINGS_PROXIMITY:6d<=7d
Warning (1)
- MOMENTUM:4.7<5.5 (soft — BUY_NOW allowed but watch)
Reward-to-Risk
2.69
Upside
+17.3%
Downside
6.4%
Sizing output
AVOID
SetupRecovery — Death cross but MACD improving, RSI 57
EdgeNo clear edge — No clear edge identified
SuitabilityModerate — Balanced profile
Investment implication
The SELL_IF_HOLDING verdict reflects the DEATH_CROSS gate's HARD_BLOCK outcome against Sentiment at 7.7 and asymmetric R:R of 2.69.
The strongest dimensions are Sentiment at 7.7, Catalyst at 7.0, and Insider at 5.3; the weakest are Growth at 3.0, Quality at 3.2, and Technical at 3.4. The V9 engine flagged 2 failed gates with 1 warning, producing an asymmetric reward-to-risk of 2.69 and an engine sizing output of AVOID.
What would invalidate the thesis
Falsifying conditions — when triggered, the corresponding pillar's thesis is invalidated.
- P1Perfect Earnings Beat Streak
Trip ifEPS surprise stays below 0% for 2 consecutive quarters.
- P2Negative Cash Conversion
Trip ifFCF to net income rises above 0% from current -251% for 2 consecutive quarters.
- P3Electricity Segment Concentration
Trip ifElectricity segment share falls below 60% from 70.1%.
- P4Recovery After Deep Drawdown
Trip ifRSI falls below 30 from current 41.
- P5Analyst Upside To Target
Trip ifAnalyst target falls below $90, less than 4% above the current $87.09 price.