DexCom earnings beat by $0.03, revenue topped estimates
On Friday, JPMorgan analyst Javier Garrido increased the price target for Endesa , S.A. (BME:ELE:SM) (OTC: ELEZY) to €27.50, up from the previous €23.50, while keeping an Overweight rating on the stock. The adjustment reflects confidence in the company’s potential for continued outperformance in the market. This optimism aligns with InvestingPro data showing the stock trading near its 52-week high of $13.10, with a P/E ratio of 13.7x suggesting reasonable valuation levels.
Endesa’s stock has already outperformed the Utilities sector by 13% in 2024 and by 10% year-to-date, with InvestingPro data revealing impressive returns of 47.45% over the past year. Garrido’s optimism is based on three key factors. First, he anticipates strong earnings momentum with an estimated year-over-year Ordinary Net Income growth of 6.5% for the fiscal year 2025, which is 7.5% above the Bloomberg consensus. This outlook is supported by InvestingPro’s GREAT Financial Health Score of 3.14 and projected EPS of $2.03 for FY2025.
Second, a shift towards a more favorable shareholder remuneration policy is expected. The analysis includes the assumption that a €2 billion buyback will be implemented between 2025-27, alongside an increase in payout, leading to a dividend per share for 2027 that is projected to be 25% higher than the Bloomberg consensus. Currently, the stock offers a dividend yield of 1.21%, with potential for significant growth under the new policy.
Lastly, Garrido notes positive sentiment towards the Iberian power market over the medium term. There is a growing debate around power demand growth and its potential effects on nuclear capacity closures, power prices, and infrastructure development.
Endesa is anticipated to return approximately 28% of its market capitalization to shareholders through dividends and buybacks in the period from 2025 to 2027. This projection of significant shareholder returns underpins the JPMorgan analyst’s positive stance on the stock’s future performance.
This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.