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1. Company Snapshot

1.a. Company Description

Enagás, S.A. engages in the development, operation, and maintenance of gas infrastructures in Spain, Mexico, Chile, Peru, Albania, Greece, Italy, and the United States.It operates through Gas transmission, Regasification, and Storage of Gas segments.The company provides gas transmission services through primary and secondary transmission pipelines; natural gas regasification services; and operates underground storage facilities.


It is also involved in the operation and technical management of the basic network and secondary transportation network for natural gas.In addition, the company engages in the financial management activities; development of industrial projects and activities relating to LNG terminals, and hydrogen production and transport infrastructures; development and implementation of facilities for the supply of natural gas as fuel for vehicles, including its design, construction, and maintenance; and provision of commercial services for the purpose of enhancing the daily operational management of gas shippers.Further, it is involved in the development and integrated management of energy projects for the production of renewable gases from organic matter; development of projects to promote the role of renewable gases in the energy transition; and production of solar electric energy.


The company operates approximately 12,000 kilometers of gas pipelines, 20 compressor stations, and 6 international connections.Enagás, S.A. was founded in 1972 and is headquartered in Madrid, Spain.

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1.b. Last Insights on ENG

Enagás, S.A.'s recent performance was negatively impacted by regulatory uncertainty and challenges in asset rotation. The company's Q3 2024 earnings call highlighted a 7.8% increase in core after-tax profit, but this growth was tempered by the need to navigate complex regulatory frameworks. Additionally, Enagás' strategic shift towards green hydrogen infrastructure, while a positive long-term development, may have contributed to short-term uncertainty and volatility. The company's focus on divestments, as seen in Q2 2024, may also have created some uncertainty among investors.

1.c. Company Highlights

2. Transcript Summary

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3. NewsRoom

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4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (6.11%)

6. Segments

Infrastructures

Expected Growth: 6.15%

Enagás, S.A.'s 6.15% growth in infrastructure is driven by increasing demand for natural gas, strategic expansion into new markets, and investments in renewable energy integration. Additionally, the company's focus on operational efficiency, cost savings, and regulatory support contribute to its growth momentum.

Technical Management of the System

Expected Growth: 4.83%

Enagás, S.A.'s 4.83% growth in Technical Management of the System is driven by increasing demand for natural gas, strategic infrastructure investments, and efficient operational management. Additionally, the company's focus on innovation, digitalization, and cost optimization have contributed to this growth.

Other

Expected Growth: 7.12%

Enagás, S.A.'s 7.12% growth is driven by increasing demand for natural gas in Spain, expansion into new markets, and strategic investments in infrastructure and renewable energy. Additionally, the company's diversified revenue streams, including transportation, regasification, and storage, contribute to its growth momentum.

7. Detailed Products

Natural Gas Transportation

Enagás, S.A. operates a network of pipelines that transport natural gas from production and import points to consumption points, providing a safe and reliable service to its customers.

Natural Gas Storage

Enagás, S.A. manages and operates underground natural gas storage facilities, providing a strategic reserve of natural gas to ensure supply security and flexibility.

LNG Regasification

Enagás, S.A. operates liquefied natural gas (LNG) regasification terminals, allowing for the import and distribution of LNG to meet peak demand.

Gas Infrastructure Management

Enagás, S.A. provides management and operation services for gas infrastructure, including pipeline maintenance and repair.

8. Enagás, S.A.'s Porter Forces

Forces Ranking

Threat Of Substitutes

The threat of substitutes for Enagás, S.A. is medium due to the availability of alternative energy sources such as renewable energy and liquefied natural gas (LNG).

Bargaining Power Of Customers

The bargaining power of customers for Enagás, S.A. is low due to the company's dominant position in the Spanish natural gas market and the lack of alternative suppliers.

Bargaining Power Of Suppliers

The bargaining power of suppliers for Enagás, S.A. is medium due to the company's dependence on a few large suppliers of natural gas and the potential for price fluctuations.

Threat Of New Entrants

The threat of new entrants for Enagás, S.A. is low due to the high barriers to entry in the natural gas market, including the need for significant infrastructure investments and regulatory approvals.

Intensity Of Rivalry

The intensity of rivalry for Enagás, S.A. is high due to the competitive nature of the natural gas market and the presence of several large players.

9. SWOT Analysis

Strength

Weaknesses

Opportunities

Threats

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

Value
Debt Weight 56.47%
Debt Cost 4.63%
Equity Weight 43.53%
Equity Cost 6.73%
WACC 5.55%
Leverage 129.74%

11. Quality Control: Enagás, S.A. passed 3 out of 9 key points

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

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Italgas

A-Score: 6.7/10

Value: 4.6

Growth: 3.9

Quality: 4.9

Yield: 8.1

Momentum: 9.0

Volatility: 9.7

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A-Score: 6.7/10

Value: 4.7

Growth: 6.1

Quality: 3.6

Yield: 7.0

Momentum: 8.5

Volatility: 10.0

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Snam

A-Score: 6.5/10

Value: 4.2

Growth: 3.7

Quality: 5.2

Yield: 8.8

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Volatility: 10.0

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Centrica

A-Score: 5.9/10

Value: 6.5

Growth: 5.6

Quality: 3.5

Yield: 3.1

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Volatility: 8.0

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EVN

A-Score: 5.9/10

Value: 6.6

Growth: 6.6

Quality: 5.6

Yield: 5.6

Momentum: 2.5

Volatility: 8.7

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Enagás

A-Score: 5.8/10

Value: 4.7

Growth: 1.0

Quality: 5.2

Yield: 10.0

Momentum: 4.0

Volatility: 10.0

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Peers Metrics

12.e Scoring Insights

12.f DCF BETA

Parameters

Short Term Growth

Short term Time

Long-Term Growth

WACC

Target Price

13.9$

Current Price

13.9$

Potential

-0.00%

Expected Cash-Flows