UBS has upgraded Gurit Holding AG, a Swiss composite materials supplier, to a “buy” rating from “neutral,” increasing its 12-month price target to CHF43 from CHF25. This decision reflects anticipated wind energy market growth and a reduction in near-term risks for the company.
Analysts Marti Queral Ferre and Joern Iffert established the new price target using a discounted cash flow model. This model incorporated an 8.5% weighted average cost of capital, a 1.5% terminal sales growth rate, and a 9% terminal EBITDA margin.
Gurit currently trades at approximately seven times its 2026 estimated EV/EBIT. This valuation represents about a 50% discount compared to the median of Swiss small and midcap industrials, which UBS considers an attractive risk-reward proposition.
UBS has also revised its earnings per share estimates for Gurit, increasing them by 3% to 8% across the 2026-2028 period. The firm forecasts Gurit will achieve a 10% EBIT margin by 2028, surpassing the Refinitiv-based consensus estimate of 9.4%. The analysts’ EBIT projections stand 5% and 8% above consensus for 2027 and 2028, respectively.
The upgrade is supported by three primary factors. Gurit has streamlined its stock-keeping units, including the Fiberline product line, and rationalized its contract portfolio. These actions have improved the company’s scalability and margins.
Following these rationalization efforts, Gurit is positioned for an organic sales inflection point, expecting positive growth in 2026. This indicates a shift from previous stagnation or decline to a period of expansion.
After several years characterized by overcapacities in the wind market, the supply and demand dynamics appear more balanced. This stabilization is contributing to more consistent industry pricing.
Data cited by UBS indicates new global wind installations grew approximately 40% year-on-year in 2025. Industry forecasts suggest around 8% global growth in 2026, with a projected 20%-25% growth when excluding China.
UBS estimates that wind-generated electricity supplying artificial intelligence infrastructure could see a roughly 20% compound annual growth rate from 2025 to 2030, based on International Energy Agency forecasts. This emerging demand stream presents a significant opportunity for the wind energy sector.
Two main downside risks have been identified. The first is the potential penetration of Chinese original equipment manufacturers (OEMs) into Western markets, particularly Europe. However, UBS does not anticipate a near-term impact, citing the European Commission’s antidumping investigation into Goldwind and the United Kingdom’s blocking of a Ming Yang wind turbine factory in Scotland in March 2026.
The second risk involves pricing pressure within the wind supply chain. UBS suggests this pressure is likely easing, evidenced by stable average selling prices and rising margins among OEMs. This trend indicates a healthier environment for suppliers.
For the first half of 2026, UBS forecasts an EBIT margin of approximately 10% for Gurit, a notable increase from 5.7% in the first half of the previous year. This projection underscores the expected improvements in profitability.
The long-term impact of Chinese OEM market penetration remains an area of uncertainty, despite current protective measures. Future regulatory actions and market dynamics will determine the extent of this competitive pressure.
Investors will monitor Gurit’s progress in achieving its projected EBIT margins and sales growth targets, particularly as the wind energy market continues to evolve. The interplay between global energy demand, technological advancements, and geopolitical factors will shape the company’s trajectory.