Jefferies analysis
Jefferies has raised Endesa’s target price to €35 per share from the previous €27 per share, a valuation that still places the company 11 per cent below its current share price. At the same time, the firm’s analysts have reiterated their ‘Hold’ recommendation on the stock ahead of the results announcement.
Looking ahead to its second-quarter 2026 results, due to be released on 29 July, Jefferies forecasts EBITDA of €1.5 billion (up 15% year-on-year) and net profit of €600 million.
“We expect net profit for the first half of 2026 to account for approximately 55 per cent of our forecast for the full year 2026, which could support an upward revision of the company’s guidance.”
Among the key points, the experts highlight the “strong performance” of Conventional Generation, underpinned by an one-off recognition of approximately €100 million relating to compensation for the higher fuel costs incurred to guarantee the electricity supply in the Canary Islands and the Balearic Islands, as well as higher revenue from balancing services.
Furthermore, in Renewables, they anticipate that EBITDA will grow by 23 per cent year-on-year, driven mainly by higher spot prices, partially offset by less favourable hydrological conditions (the company has not yet published its operating data).
“In the Customers division, we forecast an increase of around 15 per cent year-on-year, mainly reflecting the consolidation of the MasOrange acquisition. In Networks, we expect EBITDA to remain virtually stable year-on-year during the second quarter”.
Furthermore, excluding the one-off impact of approximately €100 million, Jefferies estimates that underlying EBITDA growth will be around 7.5% year-on-year, compared with the reported increase of 15%. As for net debt, they project that the company will reach €11 billion, compared with the €10.6 billion recorded at the end of the first half of 2026, mainly as a result of increased investment and share buy-backs.
Consequently, the firm is raising its net profit estimates by an average of 14 per cent for the period 2026–2028. “Overall, our forecasts for the Group’s EBITDA and net profit for 2026–2028 are broadly in line with the consensus.”
With regard to share buy-backs, Endesa had completed approximately €1.1 billion in buy-backs by the end of June, leaving around €900 million available under the authorised €2,000 million programme, which runs until the end of 2027.
“We assume that the remaining amount will be fully utilised before the end of the first half of 2027. The sixth tranche, recently approved and amounting to up to €500 million, which will be carried out between 15 July and 27 November 2026, would involve buybacks of around €5 million per day, equivalent to approximately 16 per cent of the average daily trading volume,” Jefferies concludes.
