Company Reports

Iberdrola is the largest integrated utility in Europe together with Enel. Besides its domestic Spanish market, Iberdrola has strong exposure to the United Kingdom since the acquisition of Scottish Power in 2007. It is the European utility with the second largest exposure to the United States after National Grid thanks to its wind development and the acquisition of UIL in 2015.

Iberdrola confirmed its 2026 net profit guidance and announced the acquisition of 80% of Caruna, a Finnish distribution company, for EUR 2 billion from KKR and Ontario Teachers' Pension Plan. The implied enterprise value is EUR 5 billion.

Iberdrola raised its 2026 net profit growth guidance to above 8% from around 6%. First-quarter recurring EBITDA increased 2% year on year to EUR 4.07 billion, and underlying net profit grew 11% to EUR 1.87 billion.

Iberdrola is the second-biggest integrated utility in Europe after Enel. Besides its domestic Spanish market, Iberdrola has strong exposure to the United Kingdom since the acquisition of Scottish Power in 2007. It is the European utility with the second largest exposure to the United States after National Grid thanks to its wind development and the acquisition of UIL in 2015. Its US assets used to be grouped in subdsidiary Avangrid that Iberdrola delisted in 2024.

Iberdrola's 2025 net profit grew 10% to EUR 6.2 billion, just in line with the double-digit growth guidance. The firm proposed to increase the dividend by only 6.3% to EUR 0.68 per share and set its 2026 net profit guidance in line with the FactSet consensus.

The European utilities sector increased by nearly 8% since the end of September, outperforming the market by 5% due to stabilizing interest rates, solid third-quarter results, and hopes that artificial intelligence growth will boost electricity consumption in Europe.

Iberdrola opened the earnings season for European utilities with solid third-quarter results, leading to a rise in 2026 net income guidance, slightly above our expectations.

European utilities shares decreased by 3% since the end of June, underperforming the market by about 6%.

Iberdrola released its 2025-28 business plan confirming the step up in networks investments announced last July while reducing its renewables investments for the third time since 2022.

On Sept. 11, Iberdrola agreed to acquire the 30.3% share of Brazilian pension fund Previ in its Brazilian subsidiary Neoenergia for EUR 1.9 billion with a price per share of BRL 32.5, 15% above the last closing share price. This deal will increase Iberdrola's ownership in Neoenergia to 84%.

Iberdrola is the second-biggest integrated utility in Europe after Enel. Besides its domestic Spanish market, Iberdrola has strong exposure to the United Kingdom since the acquisition of Scottish Power in 2007. It is the European utility with the largest exposure to the United States thanks to its wind development and the acquisition of UIL in 2015. Its US assets are grouped in subdsidiary Avangrid that Iberdrola delisted in 2024.

Iberdrola's recurring net profit rose by 7% in the first half. The firm announced a EUR 5 billion equity raise to fund a step-up in investments in electricity networks until the end of the decade.

On July 1, UK watchdog Ofgem released its draft determination for the RIIO-3 five-year regulatory regime that will apply to gas networks and electricity transmission networks as of April 2026.

European utilities rose by 12% in the second quarter, outperforming the market by 10%.

Iberdrola's first-quarter 2025 net profit jumped 26% when restated from last year's gain on the divestment of Mexican thermal assets. A positive $550 million one-off on US networks boosted earnings. 2025 guidance of mid- to high-single-digit growth in net profit was confirmed, excluding the latter.

On April 28 around midday, a sudden 60% drop of the power supply combined with a disruption in the connection with France caused a shutdown of the electricity grid in Spain and Portugal. The reason is still unknown. Power supply was fully restored on April 29.

Iberdrola is the second-biggest integrated utility in Europe after Enel. Besides its domestic Spanish market, Iberdrola has strong exposure to the United Kingdom since the acquisition of Scottish Power in 2007. It is the European utility with the largest exposure to the United States thanks to its wind development and the acquisition of UIL in 2015. Its US assets are grouped in subdsidiary Avangrid that Iberdrola delisted in 2024 by buying out the 18.5% minorities.

European utilities increased by about 10% in the first quarter of 2025 thanks to good full-year results, attractive shareholder remuneration, and limited exposure to US tariffs. The latter was key in the material outperformance of the sector.

We confirm our EUR 12.70 fair value estimate after no-moat Iberdrola released 2024 results in line with guidance and set 2025 guidance above our expectations. It will pay a 2024 dividend of EUR 0.635, 15% above last year and implying a 4.6% yield. We appreciate the group's strong track record and assets quality, but there is not enough margin of safety to buy the shares at the current price.

We confirm our EUR 12.70 fair value estimate after no-moat Iberdrola released solid nine-month results and raised its 2024 net profit guidance for the third time in a row. We see the shares as overvalued after rising by 20% over the last three months.