Original-Research: Verbio SE (von NuWays AG): BUY

Original-Research: Verbio SE - from NuWays AG

13.11.2026 / 09:00 CET/CEST

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Classification of NuWays AG to Verbio SE

Company Name: Verbio SE

ISIN: DE000A0JL9W6

Reason for the research: Update

Recommendation: BUY

Target price: EUR 41

Target price on sight of: 12 months

Last rating change:

Analyst: Jorge Gonzalez

Q1'26/27: Biodiesel beat, stronger outlook

VERBIO's Q1'26/27 EBITDA rose nearly fivefold yoy to EUR 76.1m, beating our

estimate by 24% and consensus by 14% (eNuW: EUR 61.5m, eCons: EUR 66.6m). EBITDA

rose 10% qoq excluding the EUR 19.1m Q4 GHG quota inventory valuation benefit.

FCF turned positive at EUR 13.5m (Q1'25/26: EUR -37.8m), helping reduce net debt

to EUR 83.1m from EUR 91.5m at FY-end.

Biodiesel drove the beat, with margins still strong at the start of Q2.

EBITDA more than doubled yoy to EUR 51.2m (+42% vs eNuW) and rose EUR 18.4m qoq

on broadly flat sales volumes. Market spreads recovered from their Q4 lows,

while favourable feedstock purchases lifted realised margins above the

benchmark.

Bioethanol/Biomethane EBITDA recovered to EUR 19.7m from EUR -9.5m a year

earlier, 24% below eNuW. The shortfall largely reflected temporarily lower

US production and lower sales of third-party products. EBITDA fell EUR 16.2m

qoq on a comparable basis as European ethanol spreads normalised. The US

production issues have been resolved, with utilisation back at 60-70% in

Nevada and c. 70% at South Bend. Other EBITDA reached EUR 5.2m (eNuW: EUR

-0.4m), helped by commodity forwards.

VERBIO now expects FY26/27 EBITDA at the upper end of its EUR 210-250m

guidance range (previous eNuW: EUR 230m, eCons: EUR 245m), supported by the Q1

beat and expectations of strong biodiesel spreads through calendar year-end

(eNuW: c. EUR 300/t). US ethanol spreads have narrowed from c. US$ 100/t to

US$ 40-60/t (eNuW), with higher corn oil and DDGS prices partly offsetting

the pressure on integrated margins. Stronger global ethanol demand could

support US spreads later in the year.

FY26/27 guidance excludes potential benefits from US 45Z tax credits.

Management now expects final rules in December. The programme runs through

2029, with potential retroactive claims dating back to 2025. At South Bend,

VERBIO plans to replace natural gas in its boilers with biogas from ethanol

stillage, lowering the carbon intensity of its ethanol and potentially

increasing the credit per gallon. At the CMD, management illustrated

theoretical gross annual credits of US$ 13-130m at 90% utilisation,

depending on carbon intensity and before potential value sharing. We model EUR

10m of incremental EBITDA from 45Z in each of FY27/28 and FY28/29.

European regulation could support demand for compliant biofuels. As

discussed in our latest note on E20, the German and French push for higher

ethanol blends could lift demand in an already import-dependent market and

support spreads. From January 2027, tighter German anti-fraud rules would

allow biofuels with fraudulent sustainability documentation to be excluded

from the GHG quota system, favouring compliant suppliers.

We raise our FY26/27 EBITDA estimate by 9% to EUR 250m (from EUR 230m), in line

with the upper end of guidance, reflecting the Q1 beat and continued

strength in biodiesel margins into Q2. We reiterate BUY and retain our EUR 41

price target, based on the average FY27/28-FY28/29 FCF yield. -Q1 review

table on next page-

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