Yahoo Finance Reasons to Add E.ON (EONGY) to Your Portfolio Right Now
E.ON’s EONGY strong investments in network expansion, decarbonization and energy transition make it a solid choice for investment in the utility space. The company expects earnings to grow in the next five years and beyond. This is due to expansions and digital transformation of energy networks, and the growing demand for sustainable customer solutions.
Let’s focus on the factors that make this Zacks Rank #2 (Buy) stock a strong investment pick at the moment.
Growth Projections & Surprise History
The Zacks Consensus Estimate for EONGY’s 2023 earnings has moved up 5.2% in the past 60 days to $1.01 per share.
E.ON delivered a trailing four-quarter average earnings surprise of 43.3%.
Return on Equity & Dividend Yield
Return on Equity (ROE) indicates how efficiently a company is utilizing shareholders’ funds to generate returns. At present, EONGY’s ROE is 12.7%, higher than the industry average of 9.7%.
Currently, the company has a dividend yield of 3.35%, lower than the industry’s 3.42%.
Regular Investments & Emission Reduction
E.ON continues to strengthen the foundation of its growth and investment program to accelerate the energy transition in Europe. It invested more than €1 billion in the first quarter of 2023, up 30% from the prior-year quarter's figure. The primary focus was on new grid connections for renewable energy plants, modernization of network infrastructure and investments in projects for sustainable, decentralized energy infrastructure solutions.
EONGY reaffirmed its investment projection of roughly €5.8 billion for 2023. It plans to invest a total of €33 billion in Energy Networks and Customer Solutions through 2027.
The company is committed to accelerating Europe’s transition to a new, low-carbon energy economy. It plans to reduce Scope 1 and 2 emissions by 75% and 100% within 2030 and 2040, respectively. It also aims to cut Scope 3 emissions by 50% and 100% within 2030 and 2050, respectively, compared with a 2019 base line.
Price Performance
In the past six months, E.ON’s shares have risen 26.6% against the industry’s decline of 6.4%.
Image Source: Zacks Investment Research
Other Stocks to Consider
Some other top-ranked stocks in the same sector are TransAlta TAC, Veolia Environnement VEOEY and Consolidated Edison ED. TransAlta and Veolia sport a Zacks Rank #1 (Strong Buy), and Consolidated Edison carries a Zacks Rank #2 at present. You can see the complete list of today’s Zacks #1 Rank stocks here.
The Zacks Consensus Estimate for TransAlta, Veolia and Consolidated Edison’s 2023 earnings per share indicates year-over-year growth of 1325%, 206.8% and 6.8%, respectively.
The same for TransAlta, Veolia and Consolidated Edison has moved up 50.8%, 105.7% and 0.4%, respectively, in the past 60 days.
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Consolidated Edison Inc (ED) : Free Stock Analysis Report
TransAlta Corporation (TAC) : Free Stock Analysis Report
E.ON SE (EONGY) : Free Stock Analysis Report
Veolia Environnement SA (VEOEY) : Free Stock Analysis Report
