ERG SPA (ERG.MI) Stock Fundamental Analysis
Europe - Euronext Milan - BIT:ERG - IT0001157020 - Common Stock
21.58 EUR
+0.24 (+1.12%)
We assign a fundamental rating of 5 out of 10 to ERG. ERG was compared to 20 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 it does not seem to be growing. ERG also has an excellent dividend rating.
1. Profitability
1.1 Basic Checks
ERG had positive earnings in the past year.
ERG had a positive operating cash flow in the past year.
Each year in the past 5 years ERG has been profitable.
In the past 5 years ERG always reported a positive cash flow from operatings.
1.2 Ratios
ERG's Return On Assets of 3.69% is fine compared to the rest of the industry. ERG outperforms 70.00% of its industry peers.
The Return On Equity of ERG (10.40%) is better than 75.00% of its industry peers.
ERG has a Return On Invested Capital of 5.33%. This is in the better half of the industry: ERG outperforms 75.00% of its industry peers.
Measured over the past 3 years, the Average Return On Invested Capital for ERG is in line with the industry average of 5.17%.
The 3 year average ROIC (4.72%) for ERG is below the current ROIC(5.33%), indicating increased profibility in the last year.
| 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
Looking at the Profit Margin, with a value of 19.28%, ERG is in the better half of the industry, outperforming 80.00% of the companies in the same industry.
In the last couple of years the Profit Margin of ERG has grown nicely.
The Operating Margin of ERG (33.37%) is better than 85.00% of its industry peers.
In the last couple of years the Operating Margin of ERG has grown nicely.
ERG has a Gross Margin of 98.63%. This is amongst the best in the industry. ERG outperforms 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.
The number of shares outstanding for ERG has been reduced compared to 5 years ago.
The debt/assets ratio for ERG is higher compared to a year ago.
2.2 Solvency
ERG has an Altman-Z score of 1.49. This is a bad value and indicates that ERG is not financially healthy and even has some risk of bankruptcy.
Looking at the Altman-Z score, with a value of 1.49, ERG is in the better half of the industry, outperforming 65.00% 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.
ERG has a better Debt to FCF ratio (9.46) than 80.00% 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.
Looking at the Debt to Equity ratio, with a value of 1.30, ERG is doing worse than 60.00% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.3 | ||
| Debt/FCF | 9.46 | ||
| Altman-Z | 1.49 |
ROIC/WACC1.16
WACC4.61%
2.3 Liquidity
ERG has a Current Ratio of 1.71. This is a normal value and indicates that ERG is financially healthy and should not expect problems in meeting its short term obligations.
ERG has a Current ratio of 1.71. This is comparable to the rest of the industry: ERG outperforms 50.00% of its industry peers.
A Quick Ratio of 1.65 indicates that ERG should not have too much problems paying its short term obligations.
ERG has a Quick ratio of 1.65. This is comparable to the rest of the industry: ERG outperforms 55.00% of its industry peers.
| 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%.
ERG shows a strong growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 43.27% yearly.
The Revenue has decreased by -3.11% in the past year.
The Revenue has been decreasing by -6.29% on average over the past years.
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
ERG is expected to show a decrease in Earnings Per Share. In the coming years, the EPS will decrease by -1.76% yearly.
Based on estimates for the next years, ERG will show a small growth in Revenue. The Revenue will grow by 5.19% on average per year.
EPS Next Y-6.7%
EPS Next 2Y4.64%
EPS Next 3Y3.24%
EPS Next 5Y-1.76%
Revenue Next Year6.13%
Revenue Next 2Y6.37%
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
Based on the Price/Earnings ratio of 14.99, the valuation of ERG can be described as correct.
75.00% of the companies in the same industry are more expensive than ERG, based on the Price/Earnings ratio.
ERG's Price/Earnings ratio indicates a valuation a bit cheaper than the S&P500 average which is at 26.54.
Based on the Price/Forward Earnings ratio of 14.67, the valuation of ERG can be described as correct.
ERG's Price/Forward Earnings ratio is a bit cheaper when compared to the industry. ERG is cheaper than 70.00% of the companies in the same industry.
When comparing the Price/Forward Earnings ratio of ERG to the average of the S&P500 Index (23.78), we can say ERG is valued slightly cheaper.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 14.99 | ||
| Fwd PE | 14.67 |
4.2 Price Multiples
Based on the Enterprise Value to EBITDA ratio, ERG is valued a bit cheaper than 65.00% of the companies in the same industry.
Based on the Price/Free Cash Flow ratio, ERG is valued a bit cheaper than the industry average as 80.00% of the companies are valued more expensively.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 11.45 | ||
| EV/EBITDA | 7.65 |
4.3 Compensation for Growth
The excellent profitability rating of ERG may justify a higher PE ratio.
PEG (NY)N/A
PEG (5Y)0.35
EPS Next 2Y4.64%
EPS Next 3Y3.24%
5. Dividend
5.1 Amount
ERG has a Yearly Dividend Yield of 4.69%, which is a nice return.
Compared to an average industry Dividend Yield of 2.47, ERG pays a better dividend. On top of this ERG pays more dividend than 90.00% of the companies listed in the same industry.
Compared to an average S&P500 Dividend Yield of 1.96, ERG pays a better dividend.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 4.69% |
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.
ERG's earnings are declining while the Dividend Rate has been growing. This means the dividend growth is most likely not sustainable.
DP72.21%
EPS Next 2Y4.64%
EPS Next 3Y3.24%
BIT:ERG (12/12/2025, 7:00:00 PM)
21.58
+0.24 (+1.12%)
Chartmill FA Rating
GICS SectorUtilities
GICS IndustryGroupUtilities
GICS IndustryIndependent Power and Renewable Electricity Producers
Earnings (Last)
Earnings (Next)
Inst Owners19.38%
Inst Owner ChangeN/A
Ins OwnersN/A
Ins Owner ChangeN/A
Market Cap3.24B
Revenue(TTM)1.09B
Net Income(TTM)210.37M
Analysts74.29
Price Target24.3 (12.6%)
Short Float %N/A
Short RatioN/A
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 4.69% |
Yearly Dividend1.04
Dividend Growth(5Y)6.57%
DP72.21%
Div Incr Years0
Div Non Decr Years0
Ex-DateN/A
Surprises & Revisions
EPS beat(2)N/A
Avg EPS beat(2)N/A
Min EPS beat(2)N/A
Max EPS beat(2)N/A
EPS beat(4)N/A
Avg EPS beat(4)N/A
Min EPS beat(4)N/A
Max EPS beat(4)N/A
EPS beat(8)N/A
Avg EPS beat(8)N/A
EPS beat(12)N/A
Avg EPS beat(12)N/A
EPS beat(16)N/A
Avg EPS beat(16)N/A
Revenue beat(2)N/A
Avg Revenue beat(2)N/A
Min Revenue beat(2)N/A
Max Revenue beat(2)N/A
Revenue beat(4)N/A
Avg Revenue beat(4)N/A
Min Revenue beat(4)N/A
Max Revenue beat(4)N/A
Revenue beat(8)N/A
Avg Revenue beat(8)N/A
Revenue beat(12)N/A
Avg Revenue beat(12)N/A
Revenue beat(16)N/A
Avg Revenue beat(16)N/A
PT rev (1m)1.11%
PT rev (3m)2.86%
EPS NQ rev (1m)N/A
EPS NQ rev (3m)N/A
EPS NY rev (1m)-1.96%
EPS NY rev (3m)-2.7%
Revenue NQ rev (1m)N/A
Revenue NQ rev (3m)N/A
Revenue NY rev (1m)-1.38%
Revenue NY rev (3m)-1.7%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 14.99 | ||
| Fwd PE | 14.67 | ||
| P/S | 2.97 | ||
| P/FCF | 11.45 | ||
| P/OCF | 7 | ||
| P/B | 1.6 | ||
| P/tB | 6.6 | ||
| EV/EBITDA | 7.65 |
EPS(TTM)1.44
EY6.67%
EPS(NY)1.47
Fwd EY6.82%
FCF(TTM)1.89
FCFY8.74%
OCF(TTM)3.08
OCFY14.28%
SpS7.26
BVpS13.46
TBVpS3.27
PEG (NY)N/A
PEG (5Y)0.35
Graham Number20.88
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 3.69% | ||
| ROE | 10.4% | ||
| ROCE | 6.94% | ||
| ROIC | 5.33% | ||
| ROICexc | 5.86% | ||
| ROICexgc | 8.48% | ||
| OM | 33.37% | ||
| PM (TTM) | 19.28% | ||
| GM | 98.63% | ||
| FCFM | 25.97% |
ROA(3y)4.55%
ROA(5y)3.78%
ROE(3y)11.87%
ROE(5y)10.57%
ROIC(3y)4.72%
ROIC(5y)3.97%
ROICexc(3y)5.64%
ROICexc(5y)4.82%
ROICexgc(3y)8.71%
ROICexgc(5y)7.19%
ROCE(3y)6.04%
ROCE(5y)5.28%
ROICexgc growth 3Y13.65%
ROICexgc growth 5Y3.76%
ROICexc growth 3Y7.92%
ROICexc growth 5Y2.32%
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%
F-Score6
Asset Turnover0.19
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.3 | ||
| Debt/FCF | 9.46 | ||
| Debt/EBITDA | 3.99 | ||
| Cap/Depr | 61.02% | ||
| Cap/Sales | 16.49% | ||
| Interest Coverage | 17.92 | ||
| Cash Conversion | 70.3% | ||
| Profit Quality | 134.72% | ||
| Current Ratio | 1.71 | ||
| Quick Ratio | 1.65 | ||
| Altman-Z | 1.49 |
F-Score6
WACC4.61%
ROIC/WACC1.16
Cap/Depr(3y)113.43%
Cap/Depr(5y)97.89%
Cap/Sales(3y)39.21%
Cap/Sales(5y)34.75%
Profit Quality(3y)163.12%
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)-36.52%
EPS 3Y3.62%
EPS 5Y43.27%
EPS Q2Q%-39.18%
EPS Next Y-6.7%
EPS Next 2Y4.64%
EPS Next 3Y3.24%
EPS Next 5Y-1.76%
Revenue 1Y (TTM)-3.11%
Revenue growth 3Y7.06%
Revenue growth 5Y-6.29%
Sales Q2Q%-0.99%
Revenue Next Year6.13%
Revenue Next 2Y6.37%
Revenue Next 3Y4.91%
Revenue Next 5Y5.19%
EBIT growth 1Y-18.6%
EBIT growth 3Y11.47%
EBIT growth 5Y6.71%
EBIT Next Year96.88%
EBIT Next 3Y29.6%
EBIT Next 5Y21.48%
FCF growth 1Y218.17%
FCF growth 3YN/A
FCF growth 5Y-11.63%
OCF growth 1Y7.02%
OCF growth 3Y39.84%
OCF growth 5Y-2.18%
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.
What is the valuation status of ERG SPA (ERG.MI) stock?
ChartMill assigns a valuation rating of 5 / 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.
How financially healthy is ERG SPA?
The financial health rating of ERG SPA (ERG.MI) is 4 / 10.
Can you provide the dividend sustainability for ERG stock?
The dividend rating of ERG SPA (ERG.MI) is 7 / 10 and the dividend payout ratio is 72.21%.