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E.ON SE EOAN

Morningstar Rating
€12.26 +0.01 (0.04%)
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Company Report

National Grid Earnings: Highly Dilutive Rights Issue to Fund Investments Step-Up

We maintain our GBX 1,040 fair value estimate after National Grid released fiscal 2024 results that were in line with company-compiled consensus and a new 5-year strategic plan calling for a massive step-up in investments to be funded by a GBP 7 billion rights issue and noncore asset disposals. The firm will pay a GBX 58.5 dividend in fiscal 2024, 5.6% above last year. It extends its target to grow the dividend in line with inflation through fiscal 2029 with the caveat that the 2024 dividend will be rebased to take into account the rights issue's shares. All in all, we forecast a 2025 dividend of GBX 43.

Price vs Fair Value

EOAN is trading at a 417% premium.
Price
€12.25
Fair Value
€27.00
Uncertainty
Medium
1-Star Price
€24.76
5-Star Price
€68.60
Economic Moat
Dkmdr
Capital Allocation
Vnlfzqvjh

Bulls Say, Bears Say

Bulls

Rising interests are triggering hikes in networks' allowed returns across the board.

Bears

The rationale of the deal with RWE is poor, owing to full exposure to networks and retail. The former is very capital-intensive while the latter is damped by fierce competition and spiraling energy costs that are challenging to pass through.

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News

Trading Information

Previous Close Price
€12.25
Day Range
€12.2212.36
52-Week Range
€10.4313.48
Bid/Ask
€0.00 / €12.28
Market Cap
€32.01 Bil
Volume/Avg
3.4 Mil / 5.4 Mil

Key Statistics

Price/Earnings (Normalized)
9.12
Price/Sales
0.39
Dividend Yield (Trailing)
4.33%
Dividend Yield (Forward)
4.33%
Total Yield
4.27%

Company Profile

Since completing the transformative deal with RWE in 2019, E.On has two core businesses: energy networks and customer solutions. Its retail supply serves around 47 million customers primarily in Germany, the United Kingdom, Eastern Europe, the Netherlands, Belgium, and Sweden. Its networks business operates in Germany, Sweden, Eastern Europe, and Turkey.
Sector
Utilities
Industry
Utilities - Diversified
Stock Style Box
Large Value
Total Number of Employees
72,242

Competitors

Valuation

Metric
EOAN
IBE
CNA
Price/Earnings (Normalized)
9.1212.824.04
Price/Book Value
2.141.411.99
Price/Sales
0.391.650.30
Price/Cash Flow
8.937.513.58
Price/Earnings
EOAN
IBE
CNA

Financial Strength

Metric
EOAN
IBE
CNA
Quick Ratio
0.840.601.07
Current Ratio
0.900.771.44
Interest Coverage
1.174.9821.27
Quick Ratio
EOAN
IBE
CNA

Profitability

Metric
EOAN
IBE
CNA
Return on Assets (Normalized)
2.65%4.79%7.66%
Return on Equity (Normalized)
20.30%14.40%59.36%
Return on Invested Capital (Normalized)
7.77%7.51%24.74%
Return on Assets
EOAN
IBE
CNA
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Utilities - Diversified Industry Comparables

Ticker
Name
Morningstar Rating for Stocks
Capital Allocation
Economic Moat
Market Cap
IBDRY
Iberdrola SA ADRRNzby$83.0 Bil
IBDSF
Iberdrola SAJskr$81.4 Bil
ESOCF
Enel SpAKcgslpnvmRjqk$72.4 Bil
ENLAY
Enel SpA ADRGkdjldzdHtsp$72.4 Bil
SRE
SempraVnkttfstNtklgv$46.8 Bil
ENGIY
Engie SA ADRNphq$40.7 Bil
ENGQF
Engie SAZtns$40.6 Bil
ENAKF
E.ON SENpw$35.2 Bil
EONGY
E.ON SE ADRTflrghpfvXhvm$34.7 Bil
AES
The AES CorpBcyzywxxsQymgs$15.0 Bil

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