If you have ever stared at your portfolio and wondered what to do about Ørsted, you are definitely not alone. After all, watching the stock fall by a jaw-dropping 40.7% in just the past month is the kind of headline move that gets even seasoned investors talking. To make things more interesting, the stock rebounded 6.8% in the last week alone, reminding everyone that markets move both ways and that investor sentiment can turn, sometimes quickly, on a dime.

To set the stage, let’s zoom out for a moment. Year-to-date, Ørsted is down nearly 64% and, over five years, the stock is off almost 78%. Those numbers paint a picture of a company that’s been through a tough patch. Much of this long-term pressure has stemmed from sector-wide concerns about rising costs for renewable energy projects, shifting government policy signals, and an evolving competitive backdrop. Yet, each time the stock feels over-punished, buyers seem to step in, hinting at underlying belief in the company’s potential and the future of clean energy infrastructure.

But here is where things get particularly interesting: even after all these wild swings, Ørsted earns a valuation score of 4 out of 6. By most measures, that means the company is showing up as undervalued in two-thirds of the tests that matter. Of course, those are just numbers. What really matters is how we approach them. So, let’s dive into the common valuation methods investors use and explore an even sharper tool for judging whether Ørsted might be a bargain hiding in plain sight.

Why Ørsted is lagging behind its peers

A Discounted Cash Flow (DCF) model estimates a company's intrinsic value by projecting all its future free cash flows and then discounting those back to today's value in DKK. For Ørsted, recent analysis uses a 2 Stage Free Cash Flow to Equity approach to build a realistic picture of long-term value.

Currently, Ørsted’s last twelve months’ free cash flow stands at negative DKK 22.2 billion, reflecting the heavy investment phase that is common in renewables. Analyst projections anticipate ongoing negative cash flows for the next couple of years, with DKK -35.8 billion in 2026 and DKK -24.6 billion in 2027. However, the company is expected to swing positive, generating DKK 54.4 billion in 2028 and then moderating to DKK 30.3 billion by 2029. Simply Wall St’s extended estimates suggest free cash flows will stabilize above DKK 9.4 billion per year by 2035.

Taking all projected cash flows into account, the DCF model calculates an intrinsic value of DKK 271 per share. This implies the stock is trading at a 55.2% discount to its fair value.

Result: UNDERVALUED

Head to the Valuation section of our Company Report for more details on how we arrive at this Fair Value for Ørsted.

Our Discounted Cash Flow (DCF) analysis suggests Ørsted is undervalued by 55.2%. Track this in your watchlist or portfolio , or discover more undervalued stocks .

The Price-to-Earnings (PE) ratio is a staple metric for evaluating established, profitable companies because it connects market value directly to earnings performance. Generally, the PE ratio tells us how much investors are willing to pay for each unit of a company’s earnings, helping quickly gauge relative value.

“Fair” or normal PE ratios can vary depending on expectations for a company’s earnings growth and the level of risk investors perceive in the business. Faster-growing, low-risk firms tend to earn higher multiples, while slower-growing or riskier companies see their multiples depressed.

Right now, Ørsted’s PE ratio stands at 8.6x, which is sharply below the industry average of 15.8x and significantly under the average of its listed peers at 49.8x. On paper, this suggests that the market is pricing in either pessimism about Ørsted’s future or risks unique to the company.

However, Simply Wall St’s proprietary “Fair Ratio” goes deeper than just lining up averages. It considers the full landscape by blending in Ørsted’s earnings growth potential, profit margins, risk profile, size, and the Renewable Energy sector’s dynamics to deliver a more tailored benchmark. This approach helps investors avoid blanket comparisons that might overlook company-specific nuances.

When comparing Ørsted’s current PE multiple to its Fair Ratio, the verdict is clear: with the PE noticeably lower and not near parity, the stock appears to be undervalued relative to its earnings power and risk profile.

Result: UNDERVALUED

PE ratios tell one story, but what if the real opportunity lies elsewhere? Discover companies where insiders are betting big on explosive growth .

Earlier, we mentioned there's an even better way to approach valuation, so let’s introduce you to Narratives, a powerful tool that helps investors give meaning and context to the numbers. A Narrative is your perspective on a company, connecting its story and outlook to your own forecasts for revenue, earnings, and fair value.

With Narratives, you’re not just crunching numbers; you’re using your view of the company’s potential to build a financial forecast, which then leads directly to a fair value estimate. Narratives are easy to create and edit, available on the Simply Wall St Community page that millions of investors use, and designed to help you make smarter buy or sell decisions by instantly showing how your fair value compares to the current price.

Best of all, Narratives are updated dynamically every time new information comes in, letting you adapt your perspective as news or earnings emerge. For example, one investor’s Narrative for Ørsted may project a fair value of DKK 500 based on an optimistic turnaround, while another may see DKK 150, reflecting ongoing challenges. This demonstrates how Narratives capture real investor perspectives in real time.

Do you think there's more to the story for Ørsted? Create your own Narrative to let the Community know!

This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

Companies discussed in this article include ORSTED.cpse .

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team@simplywallst.com

If you have ever stared at your portfolio and wondered what to do about Ørsted, you are definitely not alone. After all, watching the stock fall by a jaw-dropping 40.7% in just the past month is the kind of headline move that gets even seasoned investors talking. To make things more interesting, the stock rebounded 6.8% in the last week alone, reminding everyone that markets move both ways and that investor sentiment can turn, sometimes quickly, on a dime.

To set the stage, let’s zoom out for a moment. Year-to-date, Ørsted is down nearly 64% and, over five years, the stock is off almost 78%. Those numbers paint a picture of a company that’s been through a tough patch. Much of this long-term pressure has stemmed from sector-wide concerns about rising costs for renewable energy projects, shifting government policy signals, and an evolving competitive backdrop. Yet, each time the stock feels over-punished, buyers seem to step in, hinting at underlying belief in the company’s potential and the future of clean energy infrastructure.

But here is where things get particularly interesting: even after all these wild swings, Ørsted earns a valuation score of 4 out of 6. By most measures, that means the company is showing up as undervalued in two-thirds of the tests that matter. Of course, those are just numbers. What really matters is how we approach them. So, let’s dive into the common valuation methods investors use and explore an even sharper tool for judging whether Ørsted might be a bargain hiding in plain sight.

Why Ørsted is lagging behind its peers

A Discounted Cash Flow (DCF) model estimates a company's intrinsic value by projecting all its future free cash flows and then discounting those back to today's value in DKK. For Ørsted, recent analysis uses a 2 Stage Free Cash Flow to Equity approach to build a realistic picture of long-term value.

Currently, Ørsted’s last twelve months’ free cash flow stands at negative DKK 22.2 billion, reflecting the heavy investment phase that is common in renewables. Analyst projections anticipate ongoing negative cash flows for the next couple of years, with DKK -35.8 billion in 2026 and DKK -24.6 billion in 2027. However, the company is expected to swing positive, generating DKK 54.4 billion in 2028 and then moderating to DKK 30.3 billion by 2029. Simply Wall St’s extended estimates suggest free cash flows will stabilize above DKK 9.4 billion per year by 2035.

Taking all projected cash flows into account, the DCF model calculates an intrinsic value of DKK 271 per share. This implies the stock is trading at a 55.2% discount to its fair value.

Result: UNDERVALUED

Head to the Valuation section of our Company Report for more details on how we arrive at this Fair Value for Ørsted.

Our Discounted Cash Flow (DCF) analysis suggests Ørsted is undervalued by 55.2%. Track this in your watchlist or portfolio , or discover more undervalued stocks .

The Price-to-Earnings (PE) ratio is a staple metric for evaluating established, profitable companies because it connects market value directly to earnings performance. Generally, the PE ratio tells us how much investors are willing to pay for each unit of a company’s earnings, helping quickly gauge relative value.

“Fair” or normal PE ratios can vary depending on expectations for a company’s earnings growth and the level of risk investors perceive in the business. Faster-growing, low-risk firms tend to earn higher multiples, while slower-growing or riskier companies see their multiples depressed.

Right now, Ørsted’s PE ratio stands at 8.6x, which is sharply below the industry average of 15.8x and significantly under the average of its listed peers at 49.8x. On paper, this suggests that the market is pricing in either pessimism about Ørsted’s future or risks unique to the company.

However, Simply Wall St’s proprietary “Fair Ratio” goes deeper than just lining up averages. It considers the full landscape by blending in Ørsted’s earnings growth potential, profit margins, risk profile, size, and the Renewable Energy sector’s dynamics to deliver a more tailored benchmark. This approach helps investors avoid blanket comparisons that might overlook company-specific nuances.

When comparing Ørsted’s current PE multiple to its Fair Ratio, the verdict is clear: with the PE noticeably lower and not near parity, the stock appears to be undervalued relative to its earnings power and risk profile.

Result: UNDERVALUED

PE ratios tell one story, but what if the real opportunity lies elsewhere? Discover companies where insiders are betting big on explosive growth .

Earlier, we mentioned there's an even better way to approach valuation, so let’s introduce you to Narratives, a powerful tool that helps investors give meaning and context to the numbers. A Narrative is your perspective on a company, connecting its story and outlook to your own forecasts for revenue, earnings, and fair value.

With Narratives, you’re not just crunching numbers; you’re using your view of the company’s potential to build a financial forecast, which then leads directly to a fair value estimate. Narratives are easy to create and edit, available on the Simply Wall St Community page that millions of investors use, and designed to help you make smarter buy or sell decisions by instantly showing how your fair value compares to the current price.

Best of all, Narratives are updated dynamically every time new information comes in, letting you adapt your perspective as news or earnings emerge. For example, one investor’s Narrative for Ørsted may project a fair value of DKK 500 based on an optimistic turnaround, while another may see DKK 150, reflecting ongoing challenges. This demonstrates how Narratives capture real investor perspectives in real time.

Do you think there's more to the story for Ørsted? Create your own Narrative to let the Community know!

This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

Companies discussed in this article include ORSTED.cpse .

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team@simplywallst.com

Result: UNDERVALUED

Head to the Valuation section of our Company Report for more details on how we arrive at this Fair Value for Ørsted.

Our Discounted Cash Flow (DCF) analysis suggests Ørsted is undervalued by 55.2%. Track this in your watchlist or portfolio , or discover more undervalued stocks .

The Price-to-Earnings (PE) ratio is a staple metric for evaluating established, profitable companies because it connects market value directly to earnings performance. Generally, the PE ratio tells us how much investors are willing to pay for each unit of a company’s earnings, helping quickly gauge relative value.

“Fair” or normal PE ratios can vary depending on expectations for a company’s earnings growth and the level of risk investors perceive in the business. Faster-growing, low-risk firms tend to earn higher multiples, while slower-growing or riskier companies see their multiples depressed.

Right now, Ørsted’s PE ratio stands at 8.6x, which is sharply below the industry average of 15.8x and significantly under the average of its listed peers at 49.8x. On paper, this suggests that the market is pricing in either pessimism about Ørsted’s future or risks unique to the company.

However, Simply Wall St’s proprietary “Fair Ratio” goes deeper than just lining up averages. It considers the full landscape by blending in Ørsted’s earnings growth potential, profit margins, risk profile, size, and the Renewable Energy sector’s dynamics to deliver a more tailored benchmark. This approach helps investors avoid blanket comparisons that might overlook company-specific nuances.

When comparing Ørsted’s current PE multiple to its Fair Ratio, the verdict is clear: with the PE noticeably lower and not near parity, the stock appears to be undervalued relative to its earnings power and risk profile.

Result: UNDERVALUED

PE ratios tell one story, but what if the real opportunity lies elsewhere? Discover companies where insiders are betting big on explosive growth .

Earlier, we mentioned there's an even better way to approach valuation, so let’s introduce you to Narratives, a powerful tool that helps investors give meaning and context to the numbers. A Narrative is your perspective on a company, connecting its story and outlook to your own forecasts for revenue, earnings, and fair value.

With Narratives, you’re not just crunching numbers; you’re using your view of the company’s potential to build a financial forecast, which then leads directly to a fair value estimate. Narratives are easy to create and edit, available on the Simply Wall St Community page that millions of investors use, and designed to help you make smarter buy or sell decisions by instantly showing how your fair value compares to the current price.

Best of all, Narratives are updated dynamically every time new information comes in, letting you adapt your perspective as news or earnings emerge. For example, one investor’s Narrative for Ørsted may project a fair value of DKK 500 based on an optimistic turnaround, while another may see DKK 150, reflecting ongoing challenges. This demonstrates how Narratives capture real investor perspectives in real time.

Do you think there's more to the story for Ørsted? Create your own Narrative to let the Community know!

This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

Companies discussed in this article include ORSTED.cpse .

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team@simplywallst.com