NKT shares climbed 6.45% to DKK 1,048 in Copenhagen on Wednesday, reaching a new 52-week high of DKK 1,049, as the company reported first-quarter results that exceeded market expectations. The power cable manufacturer posted an operational EBITDA of €97 million, surpassing analyst consensus of €84 million by roughly 15%. The EBITDA margin came in at 16.0%, well above the 13.4% analysts had forecast.
The earnings beat was driven by a record quarterly order intake of €4.2 billion, which included major contracts for the Western Isles and Spittal-to-Peterhead HVDC projects in Scotland, together worth approximately €2 billion, and the Eastern Green Link 3 project in the UK, valued at more than €2.2 billion. These wins boosted NKT's Transmission order backlog to €13.5 billion, up from €10.2 billion at the end of 2025.
CEO Claes Westerlind highlighted the significance of these contracts, stating that the company achieved the highest quarterly order intake in its history, providing extended visibility for future years. For a power cable supplier, this visibility translates into secured factory schedules, vessel bookings, and engineering resources, reducing project risk over the long term.
Despite the strong order performance, revenue at standard metal prices fell 3% to €610 million, with organic growth declining 4%. The decline was attributed to reduced activity on the Champlain Hudson Power Express project in the U.S. and lower subcontracting compared to the prior year. However, both the Distribution and Grid Solutions & Accessories segments posted organic growth, with margins improving across all three business lines.
The broader sector also saw gains, with Prysmian up 2.35% in Milan and Nexans rising 3.08% in Paris, as investors continued to favor stocks tied to grid upgrades and high-voltage cable demand. NKT's outperformance was driven by its own strong fundamentals: record orders, a best-ever first-quarter EBITDA, and a multi-year backlog.
Analysts remain cautious, however, with a consensus price target of DKK 826.9 over 12 months and a neutral rating. The stock now trades near the high end of analyst targets, and some argue that current valuations already price in flawless execution. NKT's guidance for 2026 remains unchanged, with revenue forecast at €2.63 billion to €2.78 billion and operational EBITDA between €360 million and €410 million.
Free cash flow remained negative at €92 million, as the company continues to invest heavily in capacity expansion. Supply-chain risks related to the Middle East were flagged as potential cost pressures in coming quarters, though no material financial impact was seen in Q1.
Despite these headwinds, the market's message is clear: NKT is increasingly viewed as a tight-supply grid infrastructure play rather than a cyclical manufacturer. This positioning carries significant weight but leaves little room for error.