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Investing.com - Berenberg has reduced its price target on E.ON SE (ETR:EOAN) to EUR17.70 from EUR18.00 while maintaining a Buy rating on the German utility company. According to InvestingPro data, E.ON currently trades at an attractive P/E ratio of 12.9x, with a market capitalization of $47.5 billion.
The price target adjustment comes despite E.ON’s impressive 61% share price increase year-to-date according to InvestingPro data, with Berenberg citing "slightly lower long-term net-income forecasts" as the reason for the modest reduction. The company has maintained dividend payments for 34 consecutive years, with 8 years of consecutive dividend increases.
Berenberg continues to see value in E.ON, which recently confirmed its fiscal year 2025 and 2028 targets during its half-year results presentation, highlighting the company’s position to play a leading role in the European energy transition through increased investments in its regulated networks business. The company maintains a "GOOD" Financial Health score according to InvestingPro analysis, with particularly strong marks in profitability and relative value metrics.
The investment thesis centers on E.ON’s strategy to deploy "an increasing and unprecedented level of critical investments" across its networks to grow its regulated asset base, receive regulated remuneration, and drive earnings and dividend growth.
Berenberg believes E.ON’s current share price does not fully reflect the "visibility and long duration of its growth trajectory," pointing to a forecasted 6% compound annual growth rate in earnings per share from 2024 to 2030, as well as the company’s "financial capacity to invest more for longer under the right regulatory conditions."
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