ERG SPA (ERG.MI) Stock Fundamental Analysis
Europe • Euronext Milan • BIT:ERG • IT0001157020
22.31 EUR
+0.01 (+0.04%)
Last: Jan 30, 2026, 01:55 PM
Overall ERG gets a fundamental rating of 5 out of 10. We evaluated ERG against 22 industry peers in the Independent Power and Renewable Electricity Producers industry. While ERG has a great profitability rating, there are some minor concerns on its financial health. ERG has a valuation in line with the averages, but on the other hand it scores bad on growth. ERG also has an excellent dividend rating.
1. Profitability
1.1 Basic Checks
- ERG had positive earnings in the past year.
- In the past year ERG had a positive cash flow from operations.
- In the past 5 years ERG has always been profitable.
- ERG had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
- Looking at the Return On Assets, with a value of 3.69%, ERG is in the better half of the industry, outperforming 72.73% of the companies in the same industry.
- The Return On Equity of ERG (10.40%) is better than 72.73% of its industry peers.
- Looking at the Return On Invested Capital, with a value of 5.33%, ERG is in the better half of the industry, outperforming 77.27% of the companies in the same industry.
- The Average Return On Invested Capital over the past 3 years for ERG is in line with the industry average of 5.29%.
- The last Return On Invested Capital (5.33%) for ERG is above the 3 year average (4.72%), which is a sign of increasing profitability.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 3.69% | ||
| ROE | 10.4% | ||
| ROIC | 5.33% |
ROA(3y)4.55%
ROA(5y)3.78%
ROE(3y)11.87%
ROE(5y)10.57%
ROIC(3y)4.72%
ROIC(5y)3.97%
1.3 Margins
- ERG has a better Profit Margin (19.28%) than 86.36% of its industry peers.
- ERG's Profit Margin has improved in the last couple of years.
- ERG has a better Operating Margin (33.37%) than 90.91% of its industry peers.
- ERG's Operating Margin has improved in the last couple of years.
- ERG has a better Gross Margin (98.63%) than 100.00% of its industry peers.
- ERG's Gross Margin has improved in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 33.37% | ||
| PM (TTM) | 19.28% | ||
| GM | 98.63% |
OM growth 3Y4.11%
OM growth 5Y13.88%
PM growth 3Y-4.11%
PM growth 5Y52.35%
GM growth 3Y-0.12%
GM growth 5Y6.64%
2. Health
2.1 Basic Checks
- With a Return on Invested Capital (ROIC) just above the Cost of Capital (WACC), ERG is creating some value.
- ERG has less shares outstanding than it did 1 year ago.
- ERG has less shares outstanding than it did 5 years ago.
- ERG has a worse debt/assets ratio than last year.
2.2 Solvency
- ERG has an Altman-Z score of 1.51. This is a bad value and indicates that ERG is not financially healthy and even has some risk of bankruptcy.
- With a decent Altman-Z score value of 1.51, ERG is doing good in the industry, outperforming 63.64% of the companies in the same industry.
- The Debt to FCF ratio of ERG is 9.46, which is on the high side as it means it would take ERG, 9.46 years of fcf income to pay off all of its debts.
- The Debt to FCF ratio of ERG (9.46) is better than 77.27% of its industry peers.
- A Debt/Equity ratio of 1.30 is on the high side and indicates that ERG has dependencies on debt financing.
- With a Debt to Equity ratio value of 1.30, ERG perfoms like the industry average, outperforming 40.91% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.3 | ||
| Debt/FCF | 9.46 | ||
| Altman-Z | 1.51 |
ROIC/WACC1.12
WACC4.74%
2.3 Liquidity
- A Current Ratio of 1.71 indicates that ERG should not have too much problems paying its short term obligations.
- The Current ratio of ERG (1.71) is comparable to the rest of the industry.
- ERG has a Quick Ratio of 1.65. This is a normal value and indicates that ERG is financially healthy and should not expect problems in meeting its short term obligations.
- With a Quick ratio value of 1.65, ERG perfoms like the industry average, outperforming 54.55% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.71 | ||
| Quick Ratio | 1.65 |
3. Growth
3.1 Past
- ERG shows a strong negative growth in Earnings Per Share. In the last year the EPS decreased by -36.52%.
- The Earnings Per Share has been growing by 43.27% on average over the past years. This is a very strong growth
- The Revenue has decreased by -3.11% in the past year.
- Measured over the past years, ERG shows a decrease in Revenue. The Revenue has been decreasing by -6.29% on average per year.
EPS 1Y (TTM)-36.52%
EPS 3Y3.62%
EPS 5Y43.27%
EPS Q2Q%-39.18%
Revenue 1Y (TTM)-3.11%
Revenue growth 3Y7.06%
Revenue growth 5Y-6.29%
Sales Q2Q%-0.99%
3.2 Future
- Based on estimates for the next years, ERG will show a decrease in Earnings Per Share. The EPS will decrease by -1.76% on average per year.
- ERG is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 5.19% yearly.
EPS Next Y-9.19%
EPS Next 2Y3.83%
EPS Next 3Y2.4%
EPS Next 5Y-1.76%
Revenue Next Year6.13%
Revenue Next 2Y6.32%
Revenue Next 3Y4.91%
Revenue Next 5Y5.19%
3.3 Evolution
- The EPS growth rate is decreasing: in the next years the growth will be less than in the last years.
- The Revenue growth rate is accelerating: in the next years the growth will be better than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
- The Price/Earnings ratio is 15.49, which indicates a correct valuation of ERG.
- 81.82% of the companies in the same industry are more expensive than ERG, based on the Price/Earnings ratio.
- The average S&P500 Price/Earnings ratio is at 28.39. ERG is valued slightly cheaper when compared to this.
- The Price/Forward Earnings ratio is 15.40, which indicates a correct valuation of ERG.
- Based on the Price/Forward Earnings ratio, ERG is valued a bit cheaper than 68.18% of the companies in the same industry.
- Compared to an average S&P500 Price/Forward Earnings ratio of 25.72, ERG is valued a bit cheaper.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 15.49 | ||
| Fwd PE | 15.4 |
4.2 Price Multiples
- Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of ERG indicates a somewhat cheap valuation: ERG is cheaper than 72.73% of the companies listed in the same industry.
- Compared to the rest of the industry, the Price/Free Cash Flow ratio of ERG indicates a rather cheap valuation: ERG is cheaper than 81.82% of the companies listed in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 11.83 | ||
| EV/EBITDA | 7.87 |
4.3 Compensation for Growth
- ERG has an outstanding profitability rating, which may justify a higher PE ratio.
PEG (NY)N/A
PEG (5Y)0.36
EPS Next 2Y3.83%
EPS Next 3Y2.4%
5. Dividend
5.1 Amount
- ERG has a Yearly Dividend Yield of 4.41%, which is a nice return.
- Compared to an average industry Dividend Yield of 2.26, ERG pays a better dividend. On top of this ERG pays more dividend than 90.91% of the companies listed in the same industry.
- ERG's Dividend Yield is rather good when compared to the S&P500 average which is at 1.82.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 4.41% |
5.2 History
- On average, the dividend of ERG grows each year by 6.57%, which is quite nice.
Dividend Growth(5Y)6.57%
Div Incr Years0
Div Non Decr Years0
5.3 Sustainability
- ERG pays out 72.21% of its income as dividend. This is not a sustainable payout ratio.
- The Dividend Rate of ERG has been growing, while earnings will be declining. This means the dividend growth is most likely not sustainable.
DP72.21%
EPS Next 2Y3.83%
EPS Next 3Y2.4%
ERG SPA / ERG.MI FAQ
What is the ChartMill fundamental rating of ERG SPA (ERG.MI) stock?
ChartMill assigns a fundamental rating of 5 / 10 to ERG.MI.
Can you provide the valuation status for ERG SPA?
ChartMill assigns a valuation rating of 6 / 10 to ERG SPA (ERG.MI). This can be considered as Fairly Valued.
What is the profitability of ERG stock?
ERG SPA (ERG.MI) has a profitability rating of 8 / 10.
What is the financial health of ERG SPA (ERG.MI) stock?
The financial health rating of ERG SPA (ERG.MI) is 4 / 10.
How sustainable is the dividend of ERG SPA (ERG.MI) stock?
The dividend rating of ERG SPA (ERG.MI) is 7 / 10 and the dividend payout ratio is 72.21%.