Enel SpA (BIT:ENEL) Beat Earnings, And Analysts Have Been Reviewing Their Forecasts

A week ago, Enel SpA (BIT:ENEL) came out with a strong set of first-quarter numbers that could potentially lead to a re-rate of the stock. Enel delivered a significant beat with revenue hitting €22b and statutory EPS reaching €0.19, both beating estimates by more than 10%. Following the result, the analysts have updated their earnings model, and it would be good to know whether they think there's been a strong change in the company's prospects, or if it's business as usual. We thought readers would find it interesting to see the analysts latest (statutory) post-earnings forecasts for next year.

We've discovered 2 warning signs about Enel. View them for free.

Taking into account the latest results, the most recent consensus for Enel from 19 analysts is for revenues of €80.1b in 2025. If met, it would imply a modest 2.3% increase on its revenue over the past 12 months. Statutory per-share earnings are expected to be €0.68, roughly flat on the last 12 months. In the lead-up to this report, the analysts had been modelling revenues of €85.5b and earnings per share (EPS) of €0.68 in 2025. So it looks like the analysts have become a bit less optimistic after the latest results announcement, with revenues expected to fall even as the company is supposed to maintain EPS.

See our latest analysis for Enel

The average price target was steady at €8.18even though revenue estimates declined; likely suggesting the analysts place a higher value on earnings. Fixating on a single price target can be unwise though, since the consensus target is effectively the average of analyst price targets. As a result, some investors like to look at the range of estimates to see if there are any diverging opinions on the company's valuation. Currently, the most bullish analyst values Enel at €9.25 per share, while the most bearish prices it at €6.60. These price targets show that analysts do have some differing views on the business, but the estimates do not vary enough to suggest to us that some are betting on wild success or utter failure.

One way to get more context on these forecasts is to look at how they compare to both past performance, and how other companies in the same industry are performing. It's pretty clear that there is an expectation that Enel's revenue growth will slow down substantially, with revenues to the end of 2025 expected to display 3.0% growth on an annualised basis. This is compared to a historical growth rate of 5.4% over the past five years. By way of comparison, the other companies in this industry with analyst coverage are forecast to grow their revenue at 2.2% annually. So it's pretty clear that, while Enel's revenue growth is expected to slow, it's still expected to grow faster than the industry itself.

The Bottom Line

The most important thing to take away is that there's been no major change in sentiment, with the analysts reconfirming that the business is performing in line with their previous earnings per share estimates. Regrettably, they also downgraded their revenue estimates, but the latest forecasts still imply the business will grow faster than the wider industry. Still, earnings per share are more important to value creation for shareholders. The consensus price target held steady at €8.18, with the latest estimates not enough to have an impact on their price targets.

Following on from that line of thought, we think that the long-term prospects of the business are much more relevant than next year's earnings. At Simply Wall St, we have a full range of analyst estimates for Enel going out to 2027, and you can see them free on our platform here..

That said, it's still necessary to consider the ever-present spectre of investment risk. We've identified 2 warning signs with Enel (at least 1 which is a bit concerning) , and understanding these should be part of your investment process.

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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.