We confirm our GBX 2,250 fair value estimate for no-moat SSE after it released its trading statement for the first quarter of fiscal 2025. Operating performance is in line with the firm's expectations. Accordingly, the directional divisional guidance for fiscal 2025 set last May is confirmed. Shares are undervalued.
Thanks to its strong footprint in renewables and electricity networks, SSE is well-positioned to benefit from the acceleration of the energy transition aimed by the Labour government issued from the July 2024 general election.
The dividend rebase does not solve the investment funding problem given the different investment profiles of networks and renewables assets.
|
Metric
|
SSE
|
ORSTED
|
IBE
|
|---|---|---|---|
Price/Earnings (Normalized) | 10.98 | 8.91 | 13.13 |
Price/Book Value | 2.14 | 2.90 | 1.44 |
Price/Sales | 1.88 | 3.21 | 1.69 |
Price/Cash Flow | 6.92 | 14.61 | 7.69 |
|
Metric
|
SSE
|
ORSTED
|
IBE
|
|---|---|---|---|
Quick Ratio | 0.76 | 1.02 | 0.60 |
Current Ratio | 1.10 | 1.37 | 0.77 |
Interest Coverage | 8.21 | −3.35 | 4.98 |
|
Metric
|
SSE
|
ORSTED
|
IBE
|
|---|---|---|---|
Return on Assets (Normalized) | 6.37% | −2.42% | 4.79% |
Return on Equity (Normalized) | 20.08% | −10.60% | 14.40% |
Return on Invested Capital (Normalized) | 9.01% | −2.73% | 7.51% |
|
1-Day Chart
|
Name
|
Price
|
Morningstar Rating for Stocks
|
Capital Allocation
|
Economic Moat
|
Market Cap
|
|---|---|---|---|---|---|---|
| Iberdrola SA
IBDSF
| — | Bbwxgwh | $84.3 Bil | |||
| Iberdrola SA ADR
IBDRY
| QX | Tffqt | $84.3 Bil | |||
| Enel SpA
ESOCF
| Vhnntlmn | Fpzc | $73.3 Bil | |||
| Enel SpA ADR
ENLAY
| Rwqpprw | Swg | $73.3 Bil | |||
| Sempra
SRE
| Lcrzyfknw | Jkxzsx | $49.7 Bil | |||
| Engie SA ADR
ENGIY
| — | Mdjwh | $37.5 Bil | |||
| Engie SA
ENGQF
| — | Dnjk | $37.5 Bil | |||
| E.ON SE ADR
EONGY
| Wrrjjck | Wmq | $36.3 Bil | |||
| E.ON SE
ENAKF
| — | Ghzpj | $36.3 Bil | |||
| The AES Corp
AES
| Ggnfgbs | Znx | $12.5 Bil |
