Iberdrola Trims Renewables Ambitions, a Turning Point That Peers Could Emulate

We maintain our EUR 10.6 fair value estimate after no-moat Iberdrola updated its 2025 financial targets and trimmed its renewables ambitions in favor of networks. This is not surprising because the group never met its capacity additions targets since 2020 due to permitting issues and supply chain disruptions. However, this is a turning point that could be emulated by peers like Enel, Engie and EDP. Iberdrola also claims to take a more selective approach in its renewables investments, which we commend in light of the current headwinds, that is rising construction costs and interest rates. Shares look fairly valued.