Will the increase in off‑take volume (85% of a 130 MW plant) materially shift the stock’s valuation metrics and trading sentiment in the near term?

Fundamental impact – The new 15‑year PPA locks in roughly 110 MW of firm revenue (85 % of a 130 MW plant) at a price indexed to Colombia’s producer‑price inflation and denominated in pesos. Assuming the plant reaches a 20‑25 % capacity factor, the contracted output translates into roughly 200–250 GWh per year, adding an estimated €12‑15 m of annual top‑line (at current peso‑euro rates). For Scatec, which already runs a diversified portfolio of PPAs, this extra cash‑flow lifts the weighted‑average contract length to well above 12 years and reduces exposure to spot‑market volatility. The incremental EBITDA contribution (≈ €5‑7 m after OPEX) is enough to shave 0.1‑0.2 points off the current forward‑EV/EBITDA multiple and modestly improve the DCF‑derived fair value (≈ 3‑5 % uplift). Because the agreement is inflation‑adjusted, the revenue stream is protected against local price erosion, further tightening the risk‑adjusted discount rate used by analysts.

Market sentiment & technical view – The announcement pushes sentiment from a neutral‑positive baseline (sentiment score 65) toward a more bullish tone, especially given the credit‑worthy off‑taker (BTG Pactual) and the long‑term nature of the contract. In the short‑run the stock is likely to see a modest “news‑bounce” – historically Scatec gains 2‑4 % on comparable PPA releases. On the chart, the price is trading near its 50‑day EMA with a clear bullish flag forming; a breakout above the recent high (~ €7.45) on volume would confirm the sentiment shift. Conversely, a failure to hold the €7.20 support could indicate that the market is pricing the news in already.

Actionable insight – For investors with a medium‑term horizon (12‑24 months), the incremental contracted capacity improves the stability of cash‑flows and justifies a slight re‑rating of the stock toward the upper end of its peer‑group EV/EBITDA multiples. A prudent entry point is on a pull‑back to the €7.20–7.30 range, targeting a 10‑12 % upside to the €8.00–8.20 target, which incorporates the valuation uplift and the bullish sentiment premium. Position size should be modest (5‑7 % of portfolio) until the price confirms the breakout, and keep a stop‑loss just below the 50‑day EMA to guard against any reversal in sentiment if broader renewable‑energy risk premiums tighten.