Red Eléctrica Corporación (BME:REE) - Share price, News & Analysis

REE fundamental analysis
Snowflake Score
Valuation	1/6
Future Growth	0/6
Past Performance	4/6
Financial Health	4/6
Dividends	5/6

REE Stock Overview

Red Eléctrica Corporación, S.A. engages in the electricity transmission, and system operation and management of the transmission network for the electricity system in Spain and internationally.

Rewards

PE ratio (15.4x) is below the Spanish market (17.6x)

Earnings grew by 8.2% over the past year

Pays a reliable dividend of 5.12%

Risk Analysis

Earnings are forecast to decline by an average of 8.9% per year for the next 3 years

Has a high level of debt

Red Eléctrica Corporación Competitors

National Grid

LSE:NG.

UK£44.1b

Power Grid Corporation of India

BSE:532898

₹1.6t

Terna - Rete Elettrica Nazionale Società per Azioni

BIT:TRN

€16.0b

Elia Group

ENXTBR:ELI

€10.6b

Price History & Performance

Summary of all time highs, changes and price drops for Red Eléctrica Corporación
Historical stock prices
Current Share Price	€19.53
52 Week High	€19.70
52 Week Low	€15.46
Beta	0.23
1 Month Change	2.09%
3 Month Change	15.06%
1 Year Change	20.23%
3 Year Change	-0.91%
5 Year Change	-0.89%
Change since IPO	926.28%

Recent News & Updates

May 12

Capital Allocation Trends At Red Eléctrica Corporación (BME:REE) Aren't Ideal

Did you know there are some financial metrics that can provide clues of a potential multi-bagger? Typically, we'll want...

Apr 24

Estimating The Intrinsic Value Of Red Eléctrica Corporación, S.A. (BME:REE)

How far off is Red Eléctrica Corporación, S.A. ( BME:REE ) from its intrinsic value? Using the most recent financial...

Shareholder Returns

	REE	ES Electric Utilities	ES Market
7D	4.3%	3.8%	2.1%
1Y	20.2%	-1.1%	-9.1%

Return vs Industry: REE exceeded the Spanish Electric Utilities industry which returned -2.7% over the past year.

Return vs Market: REE exceeded the Spanish Market which returned -9.2% over the past year.

Price Volatility

Is REE's price volatile compared to industry and market?
REE volatility
REE Average Weekly Movement	3.8%
Electric Utilities Industry Average Movement	4.6%
Market Average Movement	4.5%
10% most volatile stocks in ES Market	8.3%
10% least volatile stocks in ES Market	1.1%

Stable Share Price: REE is not significantly more volatile than the rest of Spanish stocks over the past 3 months, typically moving +/- 4% a week.

Volatility Over Time: REE's weekly volatility (4%) has been stable over the past year.

About the Company

Founded	Employees	CEO	Website
1985	2,143	Roberto García Merino	https://www.ree.es

Red Eléctrica Corporación, S.A. engages in the electricity transmission, and system operation and management of the transmission network for the electricity system in Spain and internationally. Its transmission network comprises approximately 44,687 kilometers; and has 93,871 MVA of transformation capacity. The company also provides advisory, engineering, and construction services; telecommunications infrastructure services to telecommunications operators comprising leasing of dark fiber; and line and sub-station maintenance services.

Red Eléctrica Corporación Fundamentals Summary

How do Red Eléctrica Corporación's earnings and revenue compare to its market cap?
REE fundamental statistics
Market Cap	€10.53b
Earnings (TTM)	€681.60m
Revenue (TTM)	€2.03b

15.4x

P/E Ratio

5.2x

P/S Ratio

Is REE overvalued?

See Fair Value and valuation analysis

Earnings & Revenue

Key profitability statistics from the latest earnings report
REE income statement (TTM)
Revenue	€2.03b
Cost of Revenue	€17.53m
Gross Profit	€2.01b
Other Expenses	€1.33b
Earnings	€681.60m

Last Reported Earnings

Mar 31, 2022

Next Earnings Date

n/a

Earnings per share (EPS)	1.26
Gross Margin	99.13%
Net Profit Margin	33.60%
Debt/Equity Ratio	159.9%

How did REE perform over the long term?

See historical performance and comparison

Dividends

5.1%

Current Dividend Yield

79%

Payout Ratio

Does REE pay a reliable dividends?

See REE dividend history and benchmarks

When do you need to buy REE by to receive an upcoming dividend?
Red Eléctrica Corporación dividend dates
Ex Dividend Date	Jun 29 2022
Dividend Pay Date	Jul 01 2022
Days until Ex dividend	39 days
Days until Dividend pay date	41 days

Does REE pay a reliable dividends?

See REE dividend history and benchmarks

Valuation

Is Red Eléctrica Corporación undervalued compared to its fair value and its price relative to the market?

Valuation Score

1/6

Valuation Score 1/6

Below Fair Value
Significantly Below Fair Value
PE vs Industry
PE vs Market
PEG Ratio
PB vs Industry

15.45x

Price to Earnings (PE) ratio

Share Price vs. Fair Value

Below Fair Value: REE (€19.53) is trading above our estimate of fair value (€19.45)

Significantly Below Fair Value: REE is trading above our estimate of fair value.

Price To Earnings Ratio

PE vs Industry: REE is poor value based on its PE Ratio (15.4x) compared to the European Electric Utilities industry average (10.5x).

PE vs Market: REE is good value based on its PE Ratio (15.4x) compared to the Spanish market (17.6x).

Price to Earnings Growth Ratio

PEG Ratio: REE's earnings are forecast to decline next year, so we can't calculate its PEG ratio.

Price to Book Ratio

PB vs Industry: REE's PB Ratio (2.7x) is in line with the ES Electric Utilities industry average.

Future Growth

How is Red Eléctrica Corporación forecast to perform in the next 1 to 3 years based on estimates from 18 analysts?

Future Growth Score

0/6

Future Growth Score 0/6

Earnings vs Savings Rate
Earnings vs Market
High Growth Earnings
Revenue vs Market
High Growth Revenue
Future ROE

-8.9%

Forecasted annual earnings growth

Earnings and Revenue Growth Forecasts

Analyst Future Growth Forecasts

Earnings vs Savings Rate: REE's earnings are forecast to decline over the next 3 years (-8.9% per year).

Earnings vs Market: REE's earnings are forecast to decline over the next 3 years (-8.9% per year).

High Growth Earnings: REE's earnings are forecast to decline over the next 3 years.

Revenue vs Market: REE's revenue is expected to decline over the next 3 years (-2.6% per year).

High Growth Revenue: REE's revenue is forecast to decline over the next 3 years (-2.6% per year).

Earnings per Share Growth Forecasts

Future Return on Equity

Future ROE: REE's Return on Equity is forecast to be low in 3 years time (11.7%).

Past Performance

How has Red Eléctrica Corporación performed over the past 5 years?

Past Performance Score

4/6

Past Performance Score 4/6

Quality Earnings
Growing Profit Margin
Earnings Trend
Accelerating Growth
Earnings vs Industry
High ROE

-0.2%

Historical annual earnings growth

Earnings and Revenue History

Quality Earnings: REE has high quality earnings.

Growing Profit Margin: REE's current net profit margins (33.6%) are higher than last year (31.1%).

Past Earnings Growth Analysis

Earnings Trend: REE's earnings have declined by 0.2% per year over the past 5 years.

Accelerating Growth: REE's earnings growth over the past year (8.2%) exceeds its 5-year average (-0.2% per year).

Earnings vs Industry: REE earnings growth over the past year (8.2%) exceeded the Electric Utilities industry 6.9%.

Return on Equity

High ROE: REE's Return on Equity (17.4%) is considered low.

Financial Health

How is Red Eléctrica Corporación's financial position?

Financial Health Score

4/6

Financial Health Score 4/6

Short Term Liabilities
Long Term Liabilities
Debt Level
Reducing Debt
Debt Coverage
Interest Coverage

Financial Position Analysis

Short Term Liabilities: REE's short term assets (€2.0B) exceed its short term liabilities (€1.9B).

Long Term Liabilities: REE's short term assets (€2.0B) do not cover its long term liabilities (€7.4B).

Debt to Equity History and Analysis

Debt Level: REE's net debt to equity ratio (144.3%) is considered high.

Reducing Debt: REE's debt to equity ratio has reduced from 189.5% to 159.9% over the past 5 years.

Debt Coverage: REE's debt is well covered by operating cash flow (22.3%).

Interest Coverage: REE's interest payments on its debt are well covered by EBIT (9.2x coverage).

Balance Sheet

Dividend

What is Red Eléctrica Corporación current dividend yield, its reliability and sustainability?

Dividend Score

5/6

Dividend Score 5/6

Notable Dividend
High Dividend
Stable Dividend
Growing Dividend
Earnings Coverage
Future Dividend Coverage

5.12%

Current Dividend Yield

Upcoming Dividend Payment

Dividend Yield vs Market

Notable Dividend: REE's dividend (5.12%) is higher than the bottom 25% of dividend payers in the Spanish market (1.83%).

High Dividend: REE's dividend (5.12%) is low compared to the top 25% of dividend payers in the Spanish market (5.45%).

Stability and Growth of Payments

Stable Dividend: REE's dividends per share have been stable in the past 10 years.

Growing Dividend: REE's dividend payments have increased over the past 10 years.

Earnings Payout to Shareholders

Earnings Coverage: At its current payout ratio (79.1%), REE's payments are covered by earnings.

Cash Payout to Shareholders

Cash Flow Coverage: With its reasonable cash payout ratio (63.3%), REE's dividend payments are covered by cash flows.

Discover strong dividend paying companies

Management

How experienced are the management team and are they aligned to shareholders interests?

2.8yrs

Average management tenure

CEO

Roberto García Merino

3yrs

Tenure

€890,000

Compensation

Mr. Roberto García Merino has been Chief Executive Officer and Executive Director of Red Eléctrica Corporación, S.A. since May 27, 2019. Mr. Merino served as Executive Director of Telecommunications and In...

CEO Compensation Analysis

Compensation vs Market: Roberto's total compensation ($USD938.92K) is below average for companies of similar size in the Spanish market ($USD2.62M).

Compensation vs Earnings: Roberto's compensation has been consistent with company performance over the past year.

Leadership Team

Experienced Management: REE's management team is considered experienced (2.8 years average tenure).

Board Members

Experienced Board: REE's board of directors are not considered experienced ( 2.6 years average tenure), which suggests a new board.

Ownership

Who are the major shareholders and have insiders been buying or selling?

Insider Trading Volume

Insider Buying: Insufficient data to determine if insiders have bought more shares than they have sold in the past 3 months.

Ownership Breakdown

Dilution of Shares: Shareholders have not been meaningfully diluted in the past year.

Data	Last Updated (UTC time)
Company Analysis	2022/05/20 00:00
End of Day Share Price	2022/05/20 00:00
Earnings	2022/03/31
Annual Earnings	2021/12/31