June 15, 2023
Top 10 Stock Enel Hold Recommendation
How to read the ranks
For every stock, we judge its performance against its peers and rank it on a scale of 1 to 100. The higher the rank, the better the stock performs than its peers. And, we do this for six investment strategies:
Value - shows how good of a value the stock is. Green is "inexpensive"; red is "expensive".
Growth - shows a company's growth potential. Green is "high growth" expected; red is "tough times ahead".
Safety - relates to the amount of debt a company has. Green is low debt level; red is high debt level.
Combined Financial - this isn't an average of the first three ranks but rather a consolidated view across several financial indicators. Green = good; red = tread carefully.
(NEW) Sentiment - quantifies professional analyst ratings and holdings as well as market pulse. Green = positive sentiment; red = skepticism (Only available to Premium Subscribers).
(NEW) 360° View - the ultimate rating with all financial and non-financial indicators.
Snapshot: Enel – Top 10 Stock in Nuclear Energy
Enel is listed as a top 10 stock on June 15, 2023 in the market index Nuclear because of its high performance in at least one of the Obermatt investment strategies. Only the Obermatt Value Rank exhibits above-average performance, which means that the stock is seen as critical by the professional community and other financial facts are below average, conveying mixed investment signals. Based on the Obermatt 360° View of 34 (34% performer), Obermatt assesses an overall hold recommendation for Enel on June 15, 2023.
Snapshot: Obermatt Ranks
| Country | Italy |
| Industry | Electric Utilities |
| Index | EURO STOXX 50, MIB, Low Emissions, Customer Focus EU, Dividends Europe, Employee Focus EU, Diversity Europe, Human Rights, Low Waste, Nuclear, Recycling |
| Size class | XX-Large |
When Obermatt identifies the Top 10 stocks in a market, it’s based on a certain investment strategy. The best performing stocks usually aren’t the ones that everyone is talking about (those are often "over-priced" and have low Value ranks).
For each investment strategy, we provide you with more detailed analysis and our recommendation. You see the ranks of the top 10 stocks ranked by that particular investment strategy (360° View, Sentiment, Value, Growth, Safety and Combined Financial Performance).
360° View: Obermatt 360° View Enel Hold
| 360 METRICS | June 15, 2023 | |||||||
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| VALUE | ||||||||
| VALUE | 84 |
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| GROWTH | ||||||||
| GROWTH | 39 |
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| SAFETY | ||||||||
| SAFETY | 6 |
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| SENTIMENT | ||||||||
| SENTIMENT | 44 |
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| 360° VIEW | ||||||||
| 360° VIEW | 34 |
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ANALYSIS: With an Obermatt 360° View of 34 (better than 34% compared with alternatives), overall professional sentiment and financial characteristics for the stock Enel are below the industry average. The 360° View is based on consolidating four consolidated indicators, with three out of four indicators below average for Enel. Only the consolidated Value Rank has an attractive rank of 84, which means that the share price of Enel is on the lower side compared with the typical size in indicators such as revenues, profits, and invested capital. This means that the stock price is lower than for 84% of alternative stocks in the same industry. All other consolidated ranks are below average. The consolidated Growth Rank has a low rank of 39, which means that the company exhibits below-average growth momentum when looking at financial metrics such as revenue, profit, and invested capital growth as well as stock returns. The consolidated Safety Rank has a riskier rank of 6, meaning the company has a riskier financing structure than 94% comparable companies when looking at the amount of its debt, its refinancing requirements, and its ability to service debt. Finally, professionals are more pessimistic about the stock than for 56% of alternative investment opportunities, reflected in the consolidated Sentiment Rank of 44. ...read more
RECOMMENDATION: With a 360° View of 34, Enel is worse than 66% of all alternative stock investment opportunities based on the Obermatt Method. Only one of the consolidated Obermatt Ranks exhibits above-average performance, namely the Value Rank at a level of 84. All other ranks are below average, so proceed with caution. The company has below-average growth expectations (Growth Rank of 39), a riskier financing structure than the competition (Safety Rank of 6), and the market sentiment in the professional investor community ranking at (Sentiment Rank of 44) is negative. This combination is sensitive to a crisis, because high debt levels (low safety) require growth to finance the debt burden. It’s no wonder that the investor community indicators are skeptical (low sentiment). Good value is sometimes an indication that the company's future is challenging. The below-par growth performance may be the reason for this assessment. We recommend evaluating whether the future of Enel is as challenging as the low price of the stock suggests. Since the professional community is pessimistic, you might need to worry about the future of Enel. Only invest if you have solid reasons to believe that the low growth is temporary and the current market sentiment is an overreaction, possibly due to reputational issues in the past. ...read more
Sentiment Strategy: Professional Market Sentiment for Enel only reserved
ANALYSIS: With an Obermatt Sentiment Rank of 44 (better than 44% compared with alternatives), overall professional sentiment and engagement for the stock Enel is below industry average. The Sentiment Rank is based on consolidating four sentiment indicators, with all but one indicator above average for Enel. Analyst Opinions are at a rank of 69 (better than 69% of alternative investments), which means that, currently, stock research analysts tend to recommend a stock investment in the company. In addition, Analyst Opinions Change has a rank of 68, which means that stock research experts are changing their opinions for the better in recommending investing in the company. In other words, they are getting even more optimistic about investments in Enel. Finally, the Professional Investors rank is 54, which means that currently, professional investors hold more stock in this company than in 54% of alternative investment opportunities. ...read more
RECOMMENDATION: With an Obermatt Sentiment Rank of 44 (less encouraging than 56% compared with investment alternatives), Enel has a reputation among professional investors that is below that of its competitors. Pros tend to favor investing in this company. But there is also a signal for caution. Market Pulse has a rank of 13, which means that the current professional news and professional social networks tend to be negative when discussing this company (more negative news than for 87% of competitors). This could mean future risks and should make investors careful. Attention to negative news for Enel is worthwhile because they may be early warning signals. Without those, all other professional signals are encouraging, especially since analysts are getting more optimistic. ...read more
Value Strategy: Enel Stock Price Value at the top
ANALYSIS: With an Obermatt Value Rank of 84 (better than 84% compared with alternatives) for 2023, Enel shares are significantly less expensive than comparable stocks. The Value Rank is based on consolidating four value indicators that are all above average for Enel. Price-to-Sales is 74 which means that the stock price compared with what market professionals expect for future sales is lower than for 74% of comparable companies, indicating a good value for Enel's revenue size. The same is valid for expected Price-to-Profits, more favorable than for 73% of alternatives, and this is also true for the Price-to-Book capital ratio (also referred to as market-to-book ratio) with a Price-to-Capital Rank of 57. Compared with other companies in the same industry, dividend yields of Enel are expected to be higher than for 92% of all competitors (a Dividend Yield rank of 92). ...read more
RECOMMENDATION: The overall picture with a consolidated Value Rank of 84, is a strong buy recommendation based on Enel's stock price compared with the company's operational size and dividend yields. Since all value metrics are above the industry average, there is no objection to investing in Enel based on its detailed value metrics.
Growth Strategy: Enel Growth Momentum low
ANALYSIS: With an Obermatt Growth Rank of 39 (better than 39% compared with alternatives), Enel shows a below-average growth dynamic in its industry. There is limited momentum in this company. The Growth Rank is based on consolidating four value indicators, with half of the indicators below and half above average for Enel. Profit Growth has a rank of 57, which means that currently professionals expect the company to grow its profits more than 57% of its competitors. This is a good sign for shareholders, which is confirmed by an above-average Stock Returns rank of 75 (above 75% of alternative investments). But Sales Growth has a below the median rank of 23, which means that, currently, professionals expect the company to grow less than 77% of its competitors, and Capital Growth also has a lower rank of 25. ...read more
RECOMMENDATION: The overall picture with a consolidated Value Rank of 39, is a HOLD recommendation for growth and momentum investors. Because revenues and invested capital are the more solid growth indicators, the positive development on the profit side is less relevant. It may have been caused by cost-cutting, which may be a negative growth indicator. Finally, the above-average stock returns recently are a thing of the past and not a good indicator of future returns. Investors should be confident that the cost-cutting initiative leading to higher profits is to benefit the company's future. If not, there is little growth momentum, and investment is only advisable if the Value Ranks suggest a good investment timing for Enel. ...read more
Safety Strategy: Enel Debt Financing Safety risky
| SAFETY METRICS | June 15, 2023 | |||||||
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| LEVERAGE | ||||||||
| LEVERAGE | 23 |
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| REFINANCING | ||||||||
| REFINANCING | 22 |
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| LIQUIDITY | ||||||||
| LIQUIDITY | 34 |
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| CONSOLIDATED RANK: SAFETY | ||||||||
| CONSOLIDATED RANK: SAFETY | 6 |
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ANALYSIS: With an Obermatt Safety Rank of 6 (better than 6% compared with alternatives), the company Enel has much riskier financing practices than comparable other companies, which means that their overall debt burden is significantly above the industry average. This doesn't mean that the business of Enel is also risky, it only means that the company is on the riskier side in respect to bankruptcy in case things turn sour, assuming that public reporting is correct. The Safety Rank is based on consolidating three financing indicators, with all three metrics below average for Enel. Liquidity is at 34, meaning that the company generates less profit to service its debt than 66% of its competitors. This indicates that the company is on the riskier side when it comes to debt service. Even worse, Leverage is at a rank of 23, meaning the company has an above-average debt-to-equity ratio. It has more debt than 77% of its competitors. Finally, Refinancing is at a rank of 22 which means that the portion of the debt about to be refinanced is above average. It has more debt in the refinancing stage than 78% of its competitors. ...read more
RECOMMENDATION: With an Obermatt Safety Rank of 6 (worse than 94% compared with alternatives), Enel has a financing structure that is significantly riskier than that of its competitors. This combination is rather dangerous in most situations. Only very promising companies with bright future outlooks and stellar reputations can operate with such risky financing. ...read more
Combined financial peformance: Enel Below-Average Financial Performance
| COMBINED PERFORMANCE | June 15, 2023 | |||||||
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| VALUE | ||||||||
| VALUE | 84 |
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| GROWTH | ||||||||
| GROWTH | 39 |
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| SAFETY | ||||||||
| SAFETY | 34 |
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| COMBINED | ||||||||
| COMBINED | 34 |
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ANALYSIS: With an Obermatt Combined Rank of 34 (worse than 66% compared with investment alternatives), Enel (Electric Utilities, Italy) shares have somewhat below-average financial characteristics compared with similar stocks. Shares of Enel are a good value (attractively priced) with a consolidated Obermatt Value Rank of 84 (better than 84% of alternatives) but show below-average growth (Growth Rank of 39), and are riskily financed (Safety Rank of 6), which means above-average debt burdens. ...read more
RECOMMENDATION: An Obermatt Combined Rank of 34, is a hold recommendation based on Enel's financial characteristics. As the company Enel's key financial metrics exhibit good value (Obermatt Value Rank of 84) but low growth (Obermatt Growth Rank of 39) and risky financing practices (Obermatt Safety Rank of 6), it may be a risky investment, because debt in times of crises can make things worse. The good value, better than 84% of comparable companies, may indicate the company's future is challenging. If you believe that low growth is temporary or just due to a specific current event, you may conclude that the good value of the stock provides an attractive investment opportunity. ...read more
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