Verbio Ver.Bioenergie: Renewable fuels entering a new cycle; INITIATE WITH BUY - NuWays AG Research
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Verbio Ver.Bioenergie: Renewable fuels entering a new cycle; INITIATE WITH BUY - NuWays AG Research

* Emerging from an abnormal regulatory downturn as European carbon markets normalise and US profitability accelerates
* BUY: FY25/26p confirms the earnings turnaround, while further US ramp-up, GHG quota monetisation and renewable chemicals provide additional earnings and cash flow upside


VERBIO is one of Europe's leading integrated biorefineries, converting agricultural feedstocks and residues into biodiesel, bioethanol, biomethane, renewable chemicals and higher-value co products.

Its production network across Germany, the US, Canada and India maximises the value extracted from every tonne of biomass, while providing diversification across products, geographies, feedstocks and regulatory regimes.

We initiate coverage with BUY and a PT of € 41, based primarily on average normalised FCF across FY27/28e and FY28/29e. Assuming € 400/tCO

GHG quota prices, below current spot levels, and no exceptionally strong biofuel margin environment, our forecasts imply an adjusted FCF yield of c.10% in FY27/28e, rising further in FY28/29e, while the market still assigns limited value to regulatory normalisation, recently commissioned assets and renewable chemicals.
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