TERNA-RETE ELETTRICA NAZIONA (TRN.MI) Stock Fundamental Analysis
BIT:TRN - Borsa Italiana Milan - IT0003242622 - Common Stock - Currency: EUR
We assign a fundamental rating of 4 out of 10 to TRN. TRN was compared to 16 industry peers in the Electric Utilities industry. While TRN belongs to the best of the industry regarding profitability, there are concerns on its financial health. TRN has a decent growth rate and is not valued too expensively.
1. Profitability
1.1 Basic Checks
TRN had positive earnings in the past year.
TRN had a positive operating cash flow in the past year.
In the past 5 years TRN has always been profitable.
TRN had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
TRN has a Return On Assets of 6.11%. This is amongst the best in the industry. TRN outperforms 86.67% of its industry peers.
Looking at the Return On Equity, with a value of 20.89%, TRN is in the better half of the industry, outperforming 73.33% of the companies in the same industry.
With a Return On Invested Capital value of 8.11%, TRN perfoms like the industry average, outperforming 53.33% of the companies in the same industry.
Measured over the past 3 years, the Average Return On Invested Capital for TRN is below the industry average of 9.28%.
The 3 year average ROIC (5.32%) for TRN is below the current ROIC(8.11%), indicating increased profibility in the last year.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 6.11% | ||
| ROE | 20.89% | ||
| ROIC | 8.11% |
ROA(3y)3.69%
ROA(5y)3.82%
ROE(3y)14.94%
ROE(5y)16.17%
ROIC(3y)5.32%
ROIC(5y)5.22%
1.3 Margins
TRN has a Profit Margin of 30.25%. This is amongst the best in the industry. TRN outperforms 100.00% of its industry peers.
TRN's Profit Margin has declined in the last couple of years.
TRN has a Operating Margin of 46.06%. This is amongst the best in the industry. TRN outperforms 100.00% of its industry peers.
In the last couple of years the Operating Margin of TRN has declined.
TRN's Gross Margin of 80.66% is amongst the best of the industry. TRN outperforms 93.33% of its industry peers.
TRN's Gross Margin has been stable in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 46.06% | ||
| PM (TTM) | 30.25% | ||
| GM | 80.66% |
OM growth 3Y-2.41%
OM growth 5Y-2.11%
PM growth 3Y-4.97%
PM growth 5Y-1.83%
GM growth 3Y-0.98%
GM growth 5Y-0.38%
2. Health
2.1 Basic Checks
The Return on Invested Capital (ROIC) is just above the Cost of Capital (WACC), so TRN is still creating some value.
Compared to 1 year ago, TRN has about the same amount of shares outstanding.
The number of shares outstanding for TRN has been reduced compared to 5 years ago.
The debt/assets ratio for TRN is higher compared to a year ago.
2.2 Solvency
TRN has an Altman-Z score of 1.31. This is a bad value and indicates that TRN is not financially healthy and even has some risk of bankruptcy.
TRN has a worse Altman-Z score (1.31) than 60.00% of its industry peers.
TRN has a Debt/Equity ratio of 1.61. This is a high value indicating a heavy dependency on external financing.
TRN's Debt to Equity ratio of 1.61 is on the low side compared to the rest of the industry. TRN is outperformed by 60.00% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.61 | ||
| Debt/FCF | N/A | ||
| Altman-Z | 1.31 |
ROIC/WACC1.52
WACC5.33%
2.3 Liquidity
A Current Ratio of 0.93 indicates that TRN may have some problems paying its short term obligations.
TRN has a Current ratio of 0.93. This is comparable to the rest of the industry: TRN outperforms 53.33% of its industry peers.
A Quick Ratio of 0.90 indicates that TRN may have some problems paying its short term obligations.
TRN has a Quick ratio (0.90) which is comparable to the rest of the industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.93 | ||
| Quick Ratio | 0.9 |
3. Growth
3.1 Past
The Earnings Per Share has grown by an nice 13.88% over the past year.
TRN shows a small growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 4.60% yearly.
TRN shows quite a strong growth in Revenue. In the last year, the Revenue has grown by 13.65%.
TRN shows a small growth in Revenue. Measured over the last years, the Revenue has been growing by 6.56% yearly.
EPS 1Y (TTM)13.88%
EPS 3Y3.79%
EPS 5Y4.6%
EPS Q2Q%18.18%
Revenue 1Y (TTM)13.65%
Revenue growth 3Y9.52%
Revenue growth 5Y6.56%
Sales Q2Q%17.22%
3.2 Future
TRN is expected to show a small growth in Earnings Per Share. In the coming years, the EPS will grow by 5.00% yearly.
The Revenue is expected to grow by 8.04% on average over the next years. This is quite good.
EPS Next Y19.76%
EPS Next 2Y6.74%
EPS Next 3Y6.96%
EPS Next 5Y5%
Revenue Next Year16%
Revenue Next 2Y9.32%
Revenue Next 3Y9%
Revenue Next 5Y8.04%
3.3 Evolution
The EPS growth rate is stable: in the next years the growth will be about the same 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 15.36, which indicates a correct valuation of TRN.
TRN's Price/Earnings is on the same level as the industry average.
TRN's Price/Earnings ratio indicates a valuation a bit cheaper than the S&P500 average which is at 28.47.
With a Price/Forward Earnings ratio of 16.08, TRN is valued correctly.
Compared to the rest of the industry, the Price/Forward Earnings ratio of TRN indicates a slightly more expensive valuation: TRN is more expensive than 60.00% of the companies listed in the same industry.
TRN's Price/Forward Earnings ratio indicates a rather cheap valuation when compared to the S&P500 average which is at 92.74.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 15.36 | ||
| Fwd PE | 16.08 |
4.2 Price Multiples
Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of TRN indicates a slightly more expensive valuation: TRN is more expensive than 66.67% of the companies listed in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | N/A | ||
| EV/EBITDA | 7.8 |
4.3 Compensation for Growth
The low PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a rather cheap valuation of the company.
The decent profitability rating of TRN may justify a higher PE ratio.
PEG (NY)0.78
PEG (5Y)3.34
EPS Next 2Y6.74%
EPS Next 3Y6.96%
5. Dividend
5.1 Amount
TRN has a Yearly Dividend Yield of 4.31%, which is a nice return.
TRN's Dividend Yield is comparable with the industry average which is at 4.37.
TRN's Dividend Yield is rather good when compared to the S&P500 average which is at 2.28.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 4.31% |
5.2 History
On average, the dividend of TRN grows each year by 8.33%, which is quite nice.
Dividend Growth(5Y)8.33%
Div Incr Years0
Div Non Decr Years0
5.3 Sustainability
TRN pays out 44.99% of its income as dividend. This is a bit on the high side, but may be sustainable.
The dividend of TRN is growing, but the earnings are growing slower. This means the dividend growth is not sustainable.
DP44.99%
EPS Next 2Y6.74%
EPS Next 3Y6.96%
TERNA-RETE ELETTRICA NAZIONA
BIT:TRN (2/5/2025, 5:35:15 PM)
7.986
+0.02 (+0.25%)
Chartmill FA Rating
GICS SectorUtilities
GICS IndustryGroupUtilities
GICS IndustryElectric Utilities
Earnings (Last)
Earnings (Next)
Inst Owners30.65%
Inst Owner ChangeN/A
Ins OwnersN/A
Ins Owner ChangeN/A
Market Cap16.05B
Analysts65.83
Price Target8.49 (6.31%)
Short Float %N/A
Short RatioN/A
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 4.31% |
Yearly Dividend0.33
Dividend Growth(5Y)8.33%
DP44.99%
Div Incr Years0
Div Non Decr Years0
Ex-DateN/A
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)9.96%
Min EPS beat(2)4.64%
Max EPS beat(2)15.27%
EPS beat(4)2
Avg EPS beat(4)-4.81%
Min EPS beat(4)-37.77%
Max EPS beat(4)15.27%
EPS beat(8)3
Avg EPS beat(8)-15.04%
EPS beat(12)5
Avg EPS beat(12)-9.83%
EPS beat(16)6
Avg EPS beat(16)-6.94%
Revenue beat(2)2
Avg Revenue beat(2)1.89%
Min Revenue beat(2)1.74%
Max Revenue beat(2)2.04%
Revenue beat(4)4
Avg Revenue beat(4)2.86%
Min Revenue beat(4)1.31%
Max Revenue beat(4)6.33%
Revenue beat(8)7
Avg Revenue beat(8)13.7%
Revenue beat(12)11
Avg Revenue beat(12)42.35%
Revenue beat(16)15
Avg Revenue beat(16)55.62%
PT rev (1m)-0.13%
PT rev (3m)0.63%
EPS NQ rev (1m)0%
EPS NQ rev (3m)-1.34%
EPS NY rev (1m)3.28%
EPS NY rev (3m)3.28%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)1.63%
Revenue NY rev (1m)1.2%
Revenue NY rev (3m)1.2%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 15.36 | ||
| Fwd PE | 16.08 | ||
| P/S | 3.2 | ||
| P/FCF | N/A | ||
| P/OCF | 13.13 | ||
| P/B | 2.21 | ||
| P/tB | 2.52 | ||
| EV/EBITDA | 7.8 |
EPS(TTM)0.52
EY6.51%
EPS(NY)0.5
Fwd EY6.22%
FCF(TTM)-0.62
FCFYN/A
OCF(TTM)0.61
OCFY7.62%
SpS2.5
BVpS3.61
TBVpS3.17
PEG (NY)0.78
PEG (5Y)3.34
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 6.11% | ||
| ROE | 20.89% | ||
| ROCE | 11.95% | ||
| ROIC | 8.11% | ||
| ROICexc | 9.27% | ||
| ROICexgc | 9.76% | ||
| OM | 46.06% | ||
| PM (TTM) | 30.25% | ||
| GM | 80.66% | ||
| FCFM | N/A |
ROA(3y)3.69%
ROA(5y)3.82%
ROE(3y)14.94%
ROE(5y)16.17%
ROIC(3y)5.32%
ROIC(5y)5.22%
ROICexc(3y)6.13%
ROICexc(5y)6.07%
ROICexgc(3y)6.46%
ROICexgc(5y)6.37%
ROCE(3y)8.06%
ROCE(5y)7.78%
ROICexcg growth 3Y-0.31%
ROICexcg growth 5Y-3.15%
ROICexc growth 3Y-0.62%
ROICexc growth 5Y-3.29%
OM growth 3Y-2.41%
OM growth 5Y-2.11%
PM growth 3Y-4.97%
PM growth 5Y-1.83%
GM growth 3Y-0.98%
GM growth 5Y-0.38%
F-Score6
Asset Turnover0.2
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.61 | ||
| Debt/FCF | N/A | ||
| Debt/EBITDA | 3.73 | ||
| Cap/Depr | 299.88% | ||
| Cap/Sales | 49.34% | ||
| Interest Coverage | 6.77 | ||
| Cash Conversion | 38.99% | ||
| Profit Quality | N/A | ||
| Current Ratio | 0.93 | ||
| Quick Ratio | 0.9 | ||
| Altman-Z | 1.31 |
F-Score6
WACC5.33%
ROIC/WACC1.52
Cap/Depr(3y)248.48%
Cap/Depr(5y)231.28%
Cap/Sales(3y)63.18%
Cap/Sales(5y)59.26%
Profit Quality(3y)N/A
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)13.88%
EPS 3Y3.79%
EPS 5Y4.6%
EPS Q2Q%18.18%
EPS Next Y19.76%
EPS Next 2Y6.74%
EPS Next 3Y6.96%
EPS Next 5Y5%
Revenue 1Y (TTM)13.65%
Revenue growth 3Y9.52%
Revenue growth 5Y6.56%
Sales Q2Q%17.22%
Revenue Next Year16%
Revenue Next 2Y9.32%
Revenue Next 3Y9%
Revenue Next 5Y8.04%
EBIT growth 1Y17.84%
EBIT growth 3Y6.88%
EBIT growth 5Y4.31%
EBIT Next Year83.48%
EBIT Next 3Y27.4%
EBIT Next 5Y19.03%
FCF growth 1Y-2798.38%
FCF growth 3YN/A
FCF growth 5YN/A
OCF growth 1Y-18.49%
OCF growth 3Y4.84%
OCF growth 5Y-3.65%