Translation: Original published in Finnish on 8/14/2026 at 8:15 am EEST.

We reiterate our Buy recommendation and EUR 5.2 target price for Enersense. The company's operational Q2 figures exceeded our estimates, but its performance will nevertheless be truly tested in H2 regarding achieving its guidance. We expect the efficiency measures implemented by the company to be concretely reflected in earnings performance, but the H2-weighted nature increases risks related to timing. The company's market outlook remains strong, and we estimate this will support earnings growth in the coming years. Despite slight estimate cuts, we believe the stock's expected return, driven by earnings growth, is at a very attractive level. However, in our view, an increase in valuation still requires evidence of improved profitability, which we expect to see in the coming quarters. 

Slightly better-than-expected development

Enersense's adjusted EBITDA in Q2 was at the same level as the comparison period (3.1 MEUR), slightly exceeding our 2.7 MEUR estimate. Earnings and the Value Uplift outlook were hampered by subdued market conditions in the Estonian Power unit, which the company says weighed on performance by 1.4 MEUR. Enersense commented that it had implemented measures in Estonia to restore profitability, and these should be reflected in the Q3 figures. The company also announced that it had completed its Value Uplift efficiency program, achieving an annual earnings improvement run rate of 8.6 MEUR. The effects of this should become gradually more visible until 2027. However, in our view, this should not be interpreted as net savings. The strengthening of cash flow after an exceptional Q1 was also a positive aspect of the report.

Slight forecast cuts, but we expect the implemented measures to be reflected in the figures from H2 onwards

The company reiterated its guidance for the current year, estimating its adjusted EBITDA to be 19–23 MEUR (2025: 18.8 MEUR). According to Enersense, its order book includes several significant projects scheduled to commence in Q3. These, in turn, are expected to support development in H2, and in our view, especially in Q4. Given the performance in the first half of the year (H1’26 adjusted EBITDA: 4.6 MEUR), the second half of the year must also be strong for the company to achieve its guidance. We expect the company to be able to capitalize on the benefits of efficiency measures in connection with order backlog execution. Despite slight reductions in our forecasts, we expect the company to achieve its guidance, and we estimate the adjusted EBITDA to be 20.1 MEUR (prev. 21.2 MEUR). However, we note that our estimated Q4 weighting increases risks due to timing-related factors (e.g., weather, project schedules). We expect the company's earnings growth to accelerate further next year, driven by growth enabled by a favorable market situation and greater efficiency gains (adj. EBITDA 2027e: 23.7 MEUR). Thus, we expect to see concrete results from the strategic measures and Value Uplift in the near future.

Valuation is rather attractive, and there should be positive drivers during the next 12 months

With our estimates, EV-based multiples for the current year (hybrid bond included as debt) are, in our opinion, moderate (2026e EV/EBIT 8.5x, EV/EBITDA 5x) and at the lower end of the levels we consider neutral (EV/EBIT 8x-12x, EV/EBITDA 5x-7x). Next year's multiples are already very low (2027e EV/EBIT 6x, EV/EBITDA 4x), and we see clear upside in the earnings-based valuation. We estimate that the valuation is weighed down by the significant structural arrangements and strategic measures undertaken in recent years, which have not yet been fully reflected in the operational figures. Thus, we assume the market will require more concrete signs of earnings growth before the valuation picture changes. If the earnings turnaround progresses roughly as we expect from H2 onwards and the positive cash flow development continues, we see clear upside drivers for the valuation. Our view of the stock's significant upside is also supported by other methods (e.g. DCF EUR ~5.7/share).