Ormat Technologies to Construct 101MW Geothermal Plant in New Zealand

Ormat Technologies (ORA) Contract and Market Position - Ormat Technologies signed a $200 million EPC contract with Contact Energy for the 101 MW Te Mihi Stage 2 geothermal power plant in New Zealand, set to replace the outdated Wairakei geothermal station and be completed by mid-2027 [1] - The company expects its Product Segment backlog to exceed$300 million by year-end, with most revenues from this contract recognized in 2026 and 2027 [5] - Ormat Technologies is a leader in geothermal energy generation, with expertise in binary technology, and is strengthening its position in New Zealand's renewable energy expansion through the Te Mihi Stage 2 project and 160 MW of other ongoing projects [4][5] - Contact Energy is planning Te Mihi Stage 3, expected to be operational by mid-2031, with Ormat likely to secure another EPC contract, further boosting future revenues [6] Geothermal Energy Market Growth - The global geothermal energy market is forecasted to grow at a CAGR of 3.1% from 2024 to 2030, driven by the need to reduce greenhouse gas emissions and the reliability of geothermal energy as a backup power source [2][3] - Geothermal energy is increasingly favored due to its ability to provide constant power unaffected by weather or daylight, making it a flexible and reliable energy source [2] Opportunities for ORA's Peers - Baker Hughes Company (BKR) has over 40 years of experience in geothermal energy, with projects in more than 30 countries, and is developing advanced technologies like a metal-to-metal mud motor for enhanced geothermal systems [8] - BKR has a long-term earnings growth rate of 25.9% and is expected to achieve 8.4% year-over-year sales growth in 2024 [9] - Halliburton Company (HAL) provides products and services to reduce costs and manage risks in geothermal projects, with a long-term earnings growth rate of 2.7% and expected 3.2% year-over-year sales growth in 2025 [9][10] ORA Stock Performance - ORA shares gained 3.4% in the past month, compared to the industry's 11% growth [11] - Since October 14, 2024, ORA's total return performance was 3.4%, slightly below the Other Alt Energy Market's 11% growth [12] ORA's Zacks Rank and Industry Comparison - ORA currently holds a Zacks Rank 3 (Hold) [13] - FuelCell Energy (FCEL), a better-ranked stock in the same industry, holds a Zacks Rank 2 (Buy) and delivered an average earnings surprise of 18.75% in the last four quarters, with 2025 sales expected to grow 86.9% year-over-year [13]