ERG S.p.A. (ERG.MI) | Investment Case

1. Company Snapshot

1.a. Company Description

ERG S.p.A., through its subsidiaries, produces energy through renewable sources in Italy, France, Germany, Poland, Bulgaria, and Romania.The company generates electricity through wind, solar, hydroelectric, and thermoelectric power plants, as well as natural gas cogeneration plants.As of December 31, 2021, it had wind farms installed capacity of 2,198 MW; solar plants installed capacity of 220 MW; hydroelectric plants installed capacity of 527 MW; and thermoelectric plants installed capacity of 480 MW.

The company was founded in 1938 and is headquartered in Genoa, Italy.ERG S.p.A. is a subsidiary of San Quirico S.p.A.

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1.b. Last Insights on ERG

ERG S.p.A.'s recent performance was driven by strong Q2 2025 results, with significant EBITDA growth despite lower wind speeds impacting the first half. The company's strategic advancements and ability to navigate challenging market conditions contributed to its positive momentum. Additionally, ERG's appeal as a dividend stock, offering potential stability and income through regular payouts, has drawn investor attention amidst European market uncertainty. The company's recent earnings release highlighted its resilience, with no mention of share buybacks or legal issues. (Source: ERG SpA Q2 2025 Earnings Call Highlights)

1.c. Company Highlights

Last Price	21.98
Change Percentage	-0.72%
Open	22.14
Previous Close	22.14
Market Cap ( Millions)	3195
Volume	116264
Year High	22.98
Year Low	15.96
M A 50	22.2
M A 200	19.54

FCF Yield	8.89%
Dividend Yield	4.55%
ROE	5.96%
Debt / Equity	132.84%
Net Debt / EBIDTA	445.34%
Price To Book	1.61
Price Earnings Ratio	26.16
Price To FCF	11.25
Price To sales	4.35
EV / EBITDA	10.55

2. Transcript Summary

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3. NewsRoom

ERG SpA (FRA:ER9) Q3 2025 Earnings Call Highlights: Strong EBITDA Growth Amid Strategic Investments

Nov -14

Source:

A Closer Look at ERG (BIT:ERG) Valuation Following Recent Share Price Surge

Oct -12

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4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (5.67%)

6. Segments

Wind

Expected Growth: 5.5%

Wind from ERG S.p.A. growth driven by increasing demand for renewable energy, favorable government policies, and declining costs of wind turbines. Additionally, ERG's strategic expansion into new markets and focus on sustainable energy solutions contribute to the 5.5% growth rate.

Solar

Expected Growth: 6.5%

ERG S.p.A.'s 6.5% growth in Solar segment is driven by increasing demand for renewable energy, declining module costs, and favorable government policies. Additionally, the company's strategic expansion into emerging markets and investments in research and development have contributed to its growth momentum.

7. Detailed Products

Wind Turbines

ERG S.p.A. designs and manufactures wind turbines for onshore and offshore wind farms, providing clean and renewable energy solutions.

Solar Panels

ERG S.p.A. offers high-efficiency solar panels for residential, commercial, and industrial applications, harnessing solar energy to power homes and businesses.

Energy Storage Systems

ERG S.p.A. provides energy storage solutions, including batteries and other technologies, to optimize energy efficiency and grid stability.

Electric Vehicle Charging Infrastructure

ERG S.p.A. designs and installs electric vehicle charging stations for homes, businesses, and public spaces, supporting the adoption of electric vehicles.

Energy Efficiency Solutions

ERG S.p.A. offers energy-efficient solutions for buildings, including LED lighting, HVAC systems, and building management systems.

Renewable Energy Consulting

ERG S.p.A. provides consulting services for renewable energy projects, including feasibility studies, project development, and operations management.

8. ERG S.p.A.'s Porter Forces

Forces Ranking

Threat Of Substitutes

The threat of substitutes for ERG S.p.A. is medium due to the presence of alternative energy sources such as solar and wind power.

Bargaining Power Of Customers

The bargaining power of customers for ERG S.p.A. is low due to the lack of negotiating power of individual customers.

Bargaining Power Of Suppliers

The bargaining power of suppliers for ERG S.p.A. is medium due to the presence of multiple suppliers of fuel and equipment.

Threat Of New Entrants

The threat of new entrants for ERG S.p.A. is high due to the increasing trend of renewable energy and decreasing barriers to entry.

Intensity Of Rivalry

The intensity of rivalry for ERG S.p.A. is high due to the presence of established competitors in the energy market.

9. SWOT Analysis

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

	Value
Debt Weight	50.49%
Debt Cost	3.95%
Equity Weight	49.51%
Equity Cost	7.06%
WACC	5.49%
Leverage	102.00%

11. Quality Control: ERG S.p.A. passed 5 out of 9 key points

Strong Liquidity

Low Deb

Strong Interest Coverage

Healthy Cash Flow

Operating Efficiency

Strong Return On Equity

Consistent Revenue Growth

Consistent Operating Cash Flow Growth

Margin Improvement

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

Drax

A-Score: 6.7/10

Value: 8.8

Growth: 8.0

Quality: 5.3

Yield: 5.6

Momentum: 6.0

Volatility: 6.7

1-Year Total Return ->

BKW

A-Score: 5.9/10

Value: 3.9

Growth: 6.1

Quality: 5.4

Yield: 3.8

Momentum: 7.0

Volatility: 9.3

1-Year Total Return ->

ERG

A-Score: 5.3/10

Value: 4.0

Growth: 5.2

Quality: 4.8

Yield: 6.9

Momentum: 3.5

Volatility: 7.3

1-Year Total Return ->

Fortum

A-Score: 5.3/10

Value: 3.8

Growth: 2.8

Quality: 6.1

Yield: 5.0

Momentum: 7.0

Volatility: 7.0

1-Year Total Return ->

Acciona Energías Renovables

A-Score: 5.2/10

Value: 7.3

Growth: 4.8

Quality: 5.3

Yield: 1.2

Momentum: 7.0

Volatility: 5.7

1-Year Total Return ->

Atlantica Sustainable Infrastructure

A-Score: 4.7/10

Value: 3.5

Growth: 5.1

Quality: 3.9

Yield: 5.6

Momentum: 4.0

Volatility: 6.3

1-Year Total Return ->

Peers Metrics

12.e Scoring ^Insights

12.f DCF ^BETA

Parameters

Short Term Growth

-3.63%

Short term Time

10.0

Long-Term Growth

2.00%

WACC

5.49%

ERG S.p.A. - IT0001157020

1. Company Snapshot

1.a. Company Description

1.b. Last Insights on ERG

1.c. Company Highlights

Average Quality

Medium Volatility

Average Yield

Revenues Beats

Revenues Miss

Weak Momentum

Expensive

Fairly Valued

Higher Yield

Stable Momentum

2. Transcript Summary

3. NewsRoom

4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (5.67%)

6. Segments

Wind

Expected Growth: 5.5%

Solar

Expected Growth: 6.5%

7. Detailed Products

Wind Turbines

Solar Panels

Energy Storage Systems

Electric Vehicle Charging Infrastructure

Energy Efficiency Solutions

Renewable Energy Consulting

8. ERG S.p.A.'s Porter Forces

Forces Ranking

Threat Of Substitutes

Bargaining Power Of Customers

Bargaining Power Of Suppliers

Threat Of New Entrants

Intensity Of Rivalry

9. SWOT Analysis

Strength

Weaknesses

Opportunities

Threats

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

11. Quality Control: ERG S.p.A. passed 5 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

Peers Metrics

12.e Scoring Insights

12.f DCF BETA

Parameters

Short Term Growth

Short term Time

Long-Term Growth

WACC

Target Price

21.98$

Current Price

21.98$

Potential

-0.00%

Expected Cash-Flows

12.e Scoring ^Insights

12.f DCF ^BETA