William Blair downgrades Ameresco on ‘significant near-term hurdles’

William Blair downgraded Ameresco to Market Perform from Outperform without a price target. The company’s Q3 results were negatively affected by supply chain headwinds and delays in awarded contract conversions, as well as unplanned downtime at some energy asset plants, the analyst tells investors in a research note. While the Street has viewed the company’s 2024 adjusted EBITDA target of $300M as “aspirational yet unlikely,” the sharp degradation in revenue and earnings in Q3 and implied by Q4 guidance is likely to cause a similar level of low confidence in the company’s ability to achieve the updated target of $250M, says the firm. Blair says the historic shift in interest rates and pressures along the value chain are creating “significant near-term hurdles” for Ameresco. It expects the shares will remain range-bound.