Equatorial Energia SA (EQUEY) AI Stock Analysis

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Equatorial Energia SA

(OTC:EQUEY)

Rating:70Neutral

Price Target:

$7.00

▲(10.06%Upside)

The stock score for Equatorial Energia SA is primarily driven by strong financial performance and fair valuation. Although technical indicators currently suggest bearish momentum, the company's financial health and reasonable valuation provide a solid foundation. A lack of recent corporate events or earnings call data limits additional context.

Equatorial Energia SA (EQUEY) vs. SPDR S&P 500 ETF (SPY)

Market Cap

$7.54B

Dividend Yield0.46%

Average Volume (3M)4.86K

Price to Earnings (P/E)14.1

Beta (1Y)>-0.01

Revenue Growth1.89%

EPS Growth15.15%

CountryUS

Employees11,123

SectorUtilities

Sector Strength78

IndustryRegulated Electric

Share Statistics

EPS (TTM)0.08

Shares Outstanding1,254,548,100

10 Day Avg. Volume202

30 Day Avg. Volume4,863

Financial Highlights & Ratios

PEG Ratio1.51

Price to Book (P/B)1.61

Price to Sales (P/S)0.00

P/FCF Ratio7.41

Enterprise Value/Market CapN/A

Enterprise Value/RevenueN/A

Enterprise Value/Gross ProfitN/A

Enterprise Value/EbitdaN/A

Forecast

1Y Price Target

$7.50

Price Target Upside17.92% Upside

Rating ConsensusModerate Buy

Number of Analyst Covering0

Equatorial Energia SA Business Overview & Revenue Model

Company DescriptionEquatorial Energia S.A., through its subsidiaries, generates, transmits, and distributes electricity in Brazil. It operates through Energy Distribution, Transmission, Renewables, Distributed Generation, Sanitation, Energy Trading, Telecommunications, and Services segments. The company distributes electric energy in the 217 municipalities of Maranhão State with a concession area of approximately 332,000 square kilometers serving approximately 2.5 million consumers; 144 municipalities of Pará State with a concession area covering 1,248,000 square kilometers serving approximately 2.6 million consumers; 224 municipalities of Piauí State with a concession area covering 251,000 square kilometers serving approximately 1.3 million consumers; 102 municipalities of Alagoas State with a concession area covering 27,848 square kilometers serving approximately 1.2 million consumers; 16 municipalities of Amapá State serving approximately 209,000 consumers; and 72 municipalities of Rio de Janeiro State serving approximately 1.8 million consumers. It is also involved in the electricity trading business, as well as telecommunication, services, energy, and sanitation business. The company was founded in 1958 and is based in Brasília, Brazil.

How the Company Makes MoneyEquatorial Energia SA generates revenue through multiple streams, primarily from the distribution and sale of electricity to its customer base, which includes residential, commercial, and industrial sectors. The company benefits from regulated tariffs set by government authorities, ensuring a stable income from its distribution operations. Additionally, Equatorial Energia engages in power generation activities, contributing to its revenue through the sale of electricity in the wholesale market. Strategic acquisitions and partnerships in the energy sector further enhance its financial performance, allowing the company to expand its market presence and improve efficiency. The company also invests in infrastructure and technology to optimize operations and reduce costs, thereby boosting profitability.

Equatorial Energia SA Earnings Call Summary

Earnings Call Date:May 14, 2025

(Q3-2024)

% Change Since: -0.93%|

Next Earnings Date:Aug 13, 2025

Earnings Call Sentiment Positive

The earnings call presented a strong financial and operational performance with significant growth in various segments, particularly in energy distribution and renewables. However, there are challenges with increased debt due to recent acquisitions and some impact on the transmission segment. The positive aspects, including robust EBITDA growth and successful capital raising, outweigh the negatives.

Q3-2024 Updates

Positive Updates

Capital Increase and Subscription Success

Approved a capital increase via private subscription totaling BRL 2.5 billion, successfully completed with 100% subscription in the first round.

Strong Operating Performance in Energy Distribution

Distributed energy showed significant growth, up 6.7% above Q3 '23, maintaining good collection levels and cost discipline.

Adjusted EBITDA Growth

Achieved an adjusted EBITDA of BRL 2.9 billion, up 16% compared to the same quarter last year.

Improvement in Distribution Segment

Gross margin for distribution grew by 15.3%, with adjusted EBITDA increasing by 20.8%.

Renewables Segment Growth

Adjusted EBITDA grew by 11.7% due to the start-up of new solar farms and surplus generation from wind farms.

Sanitation Segment Progress

Positive EBITDA of BRL 1.3 million with a significant increase in billed sewage savings and water coverage index.

Negative Updates

Debt Increase Due to SABESP Acquisition

Company's net debt increased by about BRL 4.4 billion due to the acquisition of a 15% stake in SABESP.

Transmission Segment Challenges

Adjusted regulatory EBITDA fell by 2.6%, although it would have grown by 2.4% after adjusting for a complementary AVC effect.

Renewables Curtailment Impact

Constraint of impact of 318-megawatt average, 36.2% of total generation, affecting the Serra do Mel wind farm complex.

Company Guidance

In the Q3 2024 earnings call for Equatorial (EQTL3.SA), the company reported a range of financial metrics and strategic developments. They announced a successful capital increase of BRL 2.5 billion, priced at BRL 32.50 per share, with full subscription in the first round. The company utilized these funds for partial repayment of commercial notes and issued incentivized debentures amounting to BRL 2.07 billion, optimizing their debt profile. Operating metrics included a 6.7% year-over-year growth in distributed energy and a fourth consecutive quarter with distribution volumes below the regulatory loss limit. Financially, Equatorial achieved a 16% increase in adjusted EBITDA, reaching BRL 2.9 billion, and a 25.4% rise in adjusted net profit compared to Q3 2023. Their net debt EBITDA ratio was maintained at 3.2x, with cash and cash equivalents totaling BRL 10.8 billion, offering a cash to short-term debt ratio of 2x. The company also highlighted a 20% reduction in investments due to the start-up of solar parks, while projecting continued financial discipline and strategic investment opportunities.

Equatorial Energia SA Financial Statement Overview

Summary

Equatorial Energia SA exhibits a strong financial performance with significant revenue growth and stable profitability. The balance sheet shows moderate leverage but stable financial positioning, while the cash flow statement highlights robust cash generation and liquidity.

Income Statement

Very Positive

Equatorial Energia SA demonstrates strong performance in its income statement with impressive revenue growth from previous years, indicating robust business expansion. The company maintains a healthy Gross Profit Margin of 25.5% and a Net Profit Margin of 6.8% in the TTM period, reflecting efficient cost management and profitability. EBIT and EBITDA margins are also solid at 19.9% and 25.8% respectively, showing operational efficiency. Overall, the income statement highlights a trajectory of growing revenues and stable profitability.

Balance Sheet

Positive

The balance sheet of Equatorial Energia SA reflects a stable financial position with a Debt-to-Equity Ratio of 2.04, indicating a moderate level of leverage. The Return on Equity (ROE) stands at 11.5%, showcasing decent returns to shareholders. An Equity Ratio of 23.1% suggests a balanced approach to financing and asset management. While there is room for improvement in reducing leverage, the company maintains a strong equity base, supporting its growth initiatives.

Cash Flow

Positive

Equatorial Energia SA's cash flow statement exhibits a positive Free Cash Flow trend with a notable growth rate of 38.5% from the previous year, indicating effective cash management and operational efficiency. The Operating Cash Flow to Net Income Ratio of 1.52 reflects strong cash generation relative to its net earnings. Furthermore, the Free Cash Flow to Net Income Ratio of 1.89 suggests robust cash performance and liquidity, supporting future investments and debt servicing.

Breakdown	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	43.17B	40.99B	26.22B	23.61B	17.37B
Gross Profit	10.86B	10.23B	7.65B	6.27B	5.47B
EBITDA	11.00B	9.72B	7.17B	6.21B	5.92B
Net Income	2.81B	2.08B	1.37B	3.69B	2.98B
Balance Sheet
Total Assets	116.41B	103.64B	90.62B	61.71B	44.12B
Cash, Cash Equivalents and Short-Term Investments	13.04B	12.24B	7.88B	10.37B	7.62B
Total Debt	55.93B	46.56B	41.30B	25.46B	17.82B
Total Liabilities	86.52B	78.36B	72.05B	47.11B	31.85B
Stockholders Equity	26.11B	21.09B	16.61B	12.76B	10.46B
Cash Flow
Free Cash Flow	4.21B	-6.01B	3.23B	330.16M	3.47B
Operating Cash Flow	4.25B	3.14B	3.47B	1.30B	3.48B
Investing Cash Flow	-14.19B	-7.49B	-8.74B	-4.74B	-2.44B
Financing Cash Flow	8.63B	5.80B	5.44B	4.21B	-608.28M

Equatorial Energia SA Technical Analysis

Technical Analysis Sentiment

Negative

Last Price6.36

Price Trends

50DMA

6.56

Negative

100DMA

6.09

Positive

200DMA

5.64

Positive

Market Momentum

MACD

-0.06

Positive

RSI

45.34

Neutral

STOCH

30.44

Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For EQUEY, the sentiment is Negative. The current price of 6.36 is below the 20-day moving average (MA) of 6.54, below the 50-day MA of 6.56, and above the 200-day MA of 5.64, indicating a neutral trend. The MACD of -0.06 indicates Positive momentum. The RSI at 45.34 is Neutral, neither overbought nor oversold. The STOCH value of 30.44 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for EQUEY.

Equatorial Energia SA Peers Comparison

Overall Rating

UnderperformOutperform

Sector (67)

Financial Indicators

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
EBR	75 Outperform	$16.23B	8.94	8.58%	5.15%	0.18%	99.46%
EBR.B	73 Outperform	$16.23B	9.83	8.58%	8.80%	0.18%	99.46%
TXNM	70 Outperform	$5.99B	25.28	8.37%	2.80%	10.10%	149.78%
EQUEY	70 Neutral	$7.54B	14.08	12.20%	0.46%	1.89%	15.15%
KEP	69 Neutral	$16.71B	4.48	13.42%	0.37%	0.21%	628.34%
Sector *	67 Neutral	$16.78B	17.07	4.47%	4.21%	4.76%	6.06%
ENIC	57 Neutral	$4.76B	25.88	3.67%	12.95%	-12.73%	-74.65%

* Utilities Sector Average

Performance Comparison

EQUEY

Equatorial Energia SA

6.36

0.60

10.42%

EBR.B

Centrais Elc Braz Pfb B Elbras

7.76

0.76

10.86%

KEP

Korea Electric Power

13.53

6.44

90.83%

TXNM

TXNM Energy

57.36

18.58

47.91%

EBR

Centrais Eletricas Brasileiras SA - Eletrobras

7.02

0.61

9.52%

ENIC

Enel Chile SA

3.37

0.73

27.65%

Glossary

BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

Disclaimer

This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.Date of analysis: Jul 19, 2025