Reuters reported that Vestas forecast a modest decline in profit margins and steady sales easing investor worries about the impact of growing competition and falling government subsidies on the world's biggest wind turbine maker.

Shares in the Danish company, which had dropped around 20% over the past year, rose 7% in early trading.

Sydbank analyst Jacob Pedersen, echoing other analysts who pointed to better-than feared guidance for both 2018 and the longer term said that "It is a sigh of relief.”

Vestas said it expected its 2018 operating profit margin to fall to 9 to 11% on sales of 10-11 billion euros (USD 12.4 to USD 13.6 billion), compared with last year's margin of 12.4% and sales of 10.0 billion.

It also updated its long-term guidance to an operating margin of at least 10 percent from previously "best-in-class margins," and kept its goal to be market leader in revenue.

Wind turbine makers have been hit hard by an industry switch to awarding contracts via auctions, which has forced down prices, as well as a reduction in government subsidies.

Vestas chief executive Anders Runevad told Reuters that "Generally speaking we see tougher markets so that's reflected in our outlook.”

Vestas, which bounced back from the brink of bankruptcy in 2012, said its fourth-quarter order intake came with an average selling price of 740,000 euros per megawatt (MW), compared with 800,000 euros in the third quarter and below the 800,000 euros expected by analysts.

Mr Runevad said that "What we see now is that energy prices for wind are rapidly coming down driven by auctions and that puts pressure on the whole (supply) chain in the industry, but the good news is that we see now that wind in more and more markets is the cheapest form of energy.”