ANA: Downgrades And 2026 Earnings Cliff Fears Will Shape Outlook

Analysts have nudged their blended price target for Acciona modestly higher to about EUR 162 from roughly EUR 159, reflecting a slightly lower discount rate and marginally improved long term growth assumptions, even as recent downgrades flag an approaching earnings cliff and question how much growth is being priced into its concession assets.

Analyst Commentary

Street research has turned more cautious on Acciona, with a string of downgrades highlighting concerns about the durability of earnings beyond the current project cycle and the degree of growth already embedded in consensus expectations and valuation multiples.

At the same time, price targets remain broadly clustered around or above the revised blended target. This suggests that while risk perception has increased, analysts still see scope for value if execution on long term growth plans is delivered.

Bullish Takeaways

• Bullish analysts point out that most target prices still sit close to, or above, the current blended target, implying residual upside if Acciona can navigate the expected earnings slowdown.
• Some see the lower discount rate and improved long term growth assumptions as justified by the company’s infrastructure and concession pipeline, which could support cash flow visibility beyond 2026.
• The recalibration of expectations is viewed by some as healthy, potentially setting a more achievable bar for execution and reducing the risk of sharp valuation resets.
• Where target prices remain in the mid to high EUR 100s, bullish analysts argue that the market may be underestimating Acciona’s ability to recycle capital and reinvest into higher return opportunities.

Bearish Takeaways

• Bearish analysts warn of an earnings cliff around 2026, arguing that current valuations do not fully reflect the step down in profitability once major projects roll off.
• There is concern that the market is pricing in too much growth from concession assets, leaving limited margin for error if project ramp ups, traffic, or regulatory outcomes disappoint.
• Recent rating cuts from Buy or Neutral to more cautious stances signal a shift in focus from growth to capital discipline and cash generation, which could cap multiple expansion.
• Some expect that, as the growth premium compresses, Acciona’s shares could de rate closer to peers, particularly if management guidance is revised or new project awards slow.

Valuation Changes

• Fair Value: nudged slightly higher from €159.10 to about €161.74, reflecting modestly more constructive long term assumptions.
• Discount Rate: edged down marginally from roughly 8.82 percent to about 8.81 percent, indicating a slightly lower perceived risk profile.
• Revenue Growth: revised to be slightly less negative, improving from around minus 0.96 percent to roughly minus 0.94 percent.
• Net Profit Margin: trimmed modestly from about 2.34 percent to roughly 2.31 percent, pointing to a small reduction in expected profitability.
• Future P/E: increased from approximately 22.5x to about 23.1x, implying a minor uplift in the valuation multiple applied to forward earnings.