Update shared on 20 Nov 2025
Fair value Increased 3.62%Analysts have modestly adjusted their price target for RWE AG, increasing it from €45.51 to €47.16. They cite improved revenue growth projections and steady profit margins as key drivers for this upward revision.
Analyst Commentary
Analyst coverage for RWE AG continues to highlight both opportunities and risks influencing the company's valuation following recent price target adjustments.
Bullish Takeaways
- Bullish analysts cite steady revenue growth projections as supporting factors for RWE's upward price target revision.
- Solid profit margins are seen as evidence of strong operational execution, bolstering confidence in future earnings.
- RWE’s ability to navigate market challenges while maintaining an Overweight rating from major institutions suggests underlying business resilience.
- Long-term sector trends in energy transition are considered catalysts for potential outperformance relative to the sector.
Bearish Takeaways
- JPMorgan's revision, lowering its price target to EUR 46.50 from EUR 47.50, signals some caution regarding near-term growth prospects.
- Bearish analysts point to potential volatility in power markets as a risk to RWE’s earnings stability.
- Concerns remain about the pace of energy transition investments and related capital expenditures impacting short-term free cash flow.
What's in the News
- RWE completed construction of its first project in Louisiana, the 100 MW Lafitte Solar project, which will be fully online and generating energy by year-end. The project supports regional tax revenue, job creation, and local schools, and employs agrivoltaics with a flock of sheep for vegetation management (Key Developments).
- The consortium of TotalEnergies and RWE won the Centre Manche 2 (AO8) offshore wind tender for a 1.5 GW wind farm off the coast of Normandy, the largest renewable energy project in France. RWE is considering exiting the consortium, and TotalEnergies will seek a new partner. Construction is set to begin after further study and local consultation (Key Developments).
- ITM Power and RWE entered a capacity reservation agreement for 150 MW of NEPTUNE V green hydrogen units, supporting rapid scaling of hydrogen production capabilities and continuing RWE's investments in green hydrogen projects in Germany (Key Developments).
Valuation Changes
- Consensus Analyst Price Target has increased modestly from €45.51 to €47.16. This reflects a more optimistic outlook.
- Discount Rate has risen slightly, now at 6.48% compared to the previous 6.29%. This indicates a marginally higher risk premium.
- Revenue Growth expectations have increased from 4.15% to 6.72%, suggesting stronger anticipated expansion.
- Net Profit Margin has edged up from 7.75% to 7.78%, signaling continued profitability stability.
- Future P/E Ratio has moved higher from 18.31x to 18.91x. This implies a greater multiple assigned to forward earnings.
Disclaimer
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