Fair value: the average of the applicable valuation models (discounted cash flow, multiples, residual income, dividend discount, shareholder yield), each run on the latest financial statements and the market price shown. Opinion columns (fair value, target, rating) are shown apart from the data. Full methodology: acceinvestments.com/data/how-we-value-stocks
Conflicts of interest: The author holds no personal position in this security. General statement
Produced by ACCE Investments (acceinvestments.com)
Data
Price vs fair value
13.6% above
-11.9% to fair value
ACCE score
77
out of 100
P/E
17.0x
forward 16.9x
1-year return
+49.7%
Dividend yield
2.53%
Endesa in four questions
Plain answers, details below
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Overview
ACCE thesis
Endesa is Spain's largest electricity utility, running regulated power distribution networks alongside a generation and retail business that sells electricity and gas to households and companies. Its advantage is the regulated grid itself: a distribution network is a natural monopoly with returns set by the regulator, which makes earnings far more predictable than most of the sector. The main near-term driver is the build-out of grid capacity and renewables that Spain's energy transition requires, though the detail on capital plans and remuneration rates is not in the data we have and should be checked before sizing. At a 16.8x trailing and 17.8x forward P/E on a 43.2bn EUR market cap, the stock trades on earnings that are expected to be broadly flat, so the case rests on stability and yield rather than growth. The data on revenue growth, margins and returns is missing from this screen, so the first task in a deeper look is to pull those figures and the dividend record before deciding whether the name merits further work.