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Enel SpA

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Morningstar Rating for Stocks Fair Value Economic Moat Capital Allocation

Enel's Disposal Plan Is Value-Accretive

Business Strategy and Outlook

Enel has been suffering from high leverage stemming from the acquisition of Endesa at the top of the cycle in 2008. Sovereign debt crises in Spain and Italy and economic doldrums in these countries led to the implementation of adverse regulation for utilities. After 2014, the regulatory and economic backdrop in Enel’s core markets stabilised, and a new strategy aiming to boost organic growth and streamline the group organisation was implemented. Management reduced costs while increasing growth investments in regulated networks and renewables and strengthened control of its fastest-growing Latin America and renewables businesses by delisting Enel Green Power in 2016 and buying out Latin America activities from its subsidiary Endesa.

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