Assessing Iberdrola (BME:IBE) Valuation After Weaker First Quarter 2026 Earnings

Iberdrola (BME:IBE) opened the first quarter of 2026 with earnings that showed lower sales, net income, and basic EPS compared with a year earlier. This shift naturally puts the stock under closer review.

See our latest analysis for Iberdrola.

The first quarter earnings setback comes after a softer 30 day share price return of a 4.07% decline and a modest 90 day share price gain of 0.46%. However, Iberdrola’s 1 year total shareholder return of 29.63% and 5 year total shareholder return of 105.08% still point to momentum that has benefited longer term holders.

If this earnings update has you reassessing utilities, it could be a good moment to see what else is on the move via the Simply Wall St screener for 36 power grid technology and infrastructure stocks

With Iberdrola now trading close to its analyst price target and showing a calculated premium to intrinsic value, the key question is this: Are you looking at an undervalued utility giant, or has the market already priced in future growth?

Most Popular Narrative: 1.5% Overvalued

The most followed Iberdrola narrative pegs fair value at about €19.17, slightly below the last close of €19.46. This frames the current debate around upside potential.

The analysts have a consensus price target of €19.17 for Iberdrola based on their expectations of its future earnings growth, profit margins and other risk factors. However, there is a degree of disagreement amongst analysts, with the most bullish reporting a price target of €22.2, and the most bearish reporting a price target of just €14.5.

Read the complete narrative.

Want to see what is driving that tight valuation range? The narrative leans on a specific mix of revenue growth, margin expansion and a richer future earnings multiple. The key details sit in the projections, not the headline fair value.

Result: Fair Value of €19.17 (OVERVALUED)

Have a read of the narrative in full and understand what's behind the forecasts.

However, the picture could shift quickly if regulatory terms in key markets turn less favourable, or if higher funding costs squeeze returns on Iberdrola’s large investment pipeline.

Find out about the key risks to this Iberdrola narrative.

Another Angle: Multiples Point To A Richer Price

The consensus fair value of €19.17 suggests Iberdrola is only mildly overvalued, but the earnings multiple tells a tighter story. The stock trades on a P/E of 23.6x, compared with a peer average of 15.4x and a fair ratio of 24.5x that the market could move toward. That combination hints at less margin for error if sector sentiment cools or earnings slip, so how comfortable are you paying a premium for a relatively modest upside to fair value?

See what the numbers say about this price — find out in our valuation breakdown.

Next Steps

With the story feeling finely balanced between risks and rewards, this is a good time to look through the numbers yourself and decide what really matters for you. After that, you can weigh up the 2 key rewards and 2 important warning signs.

Looking for more investment ideas?

If Iberdrola sits near the edge of your comfort zone, do not stop here. Broaden your watchlist so you are not missing other compelling setups.

• Scan for quality at a discount by checking out 231 high quality undervalued stocks that pair solid fundamentals with prices that may not fully reflect them.
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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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