Goldman Sachs has upgraded EDP Renováveis (EDPR) to a Buy rating, highlighting a favourable outlook for the US renewable energy market. The investment bank’s analysts cited accelerating demand for wind and solar power, supported by federal tax incentives and a growing corporate appetite for green energy deals. The upgrade pushed EDPR shares higher in early trading, providing a lift to the wider clean energy sector on both sides of the Atlantic.
The decision comes amid a broader reassessment of renewables stocks, which have faced headwinds from rising interest rates and regulatory delays. However, Goldman Sachs believes that EDPR's strong project pipeline and exposure to the US market — where renewable capacity additions are expected to surge — position it well for earnings growth. The bank set a new price target, signalling double-digit upside from current levels.
For UK investors, the move underscores the growing importance of US energy policy on global clean energy equities. EDPR, part of the Portuguese EDP group, is a major player in wind and solar development, with significant operations across North America. The upgrade may also benefit UK-listed funds and investment trusts with exposure to renewable infrastructure, many of which have underperformed in recent months due to inflation and supply chain issues.
Analysts at Goldman noted that the Inflation Reduction Act continues to drive investment into US renewables, with tax credits providing long-term revenue visibility. 'We see EDPR as a key beneficiary of this structural shift,' the note said. The upgrade reflects a broader optimism that the sector is turning a corner, though risks remain around grid connection delays and equipment costs.
Source: Goldman Sachs research note