Orsted (AO) | Hold | We upgrade our recommendation on Orsted's hybrids to Hold, not Buy

Research evidence excerpt

Orsted (AO) | Hold | We upgrade our recommendation on Orsted's hybrids to Hold, not Buy

expansionary capex, which Fitch views (unsurprisingly) as positive for Orsted's credit

profile.

Fitch expects Orsted to maintain an ample balance-sheet headroom over 2026-27 to absorb potential US setbacks or project

delays, and forecasts FFO net leverage averaging 2.8x over 2026-28 under a conservative case (sustained below 3.0x). Close to

80% of revenues are contracted (offshore average remaining life is above 10 years), and liquidity was above DKK117bn at the end

of March 2026.

In the US, the December 2025 lease suspensions on Revolution and Sunrise have expired, though Revolution’s August 2025 stop-

work order technically remains in place. Works have progressed under the court’s preliminary injunction, and the project

achieved first power in March 2026. Sunrise Wind is the residual risk at c. 50% completion, with a commercial operation date still

expected in H2 2027. Greater Changhua 2b/4 is guided to Q3 2026.

The asset-rotation programme is near complete. Fitch expects FFO of c. DKK20bn from 2027, with negative 2026 FCF largely offset

by rotation cash-ins and c. DKK35bn negative FCF in 2027 still consistent with the rating. The shape of FCFs from 2028 will largely

depend on capex ambitions and dividend policy.

On peers, Fitch places Orsted one notch above Acciona Energías (BBB- negative), aligned with Statkraft on an SCP basis, and

below RWE / Enel / Iberdrola (BBB+ stable).

Fitch's view fits with Kepler Cheuvreux equity's view

Fitch’s outlook stabilisation is consistent with our equity team’s stance (Orsted: Buy, TP DKK185).

Both hinge on the same de-risking i.e. a balance sheet rebuilt by the DKK60bn rights issue, an asset-rotation programme that is