SNAM S.p.A. (0NQP) AI Stock Analysis

• Market Cap: €17.54B
• Dividend Yield: 5.44%
• Average Volume (3M): 505.44K
• Price to Earnings (P/E): 13.9
• Beta (1Y): 1.30
• Revenue Growth: N/A
• EPS Growth: N/A
• Country: UK
• Employees: 3,971
• Sector: Energy
• Sector Strength: 44
• Industry: Regulated Gas
• EPS (TTM): 0.11
• Shares Outstanding: 3,360,858,000
• 10 Day Avg. Volume: 549,433
• 30 Day Avg. Volume: 505,440
• PEG Ratio: 0.68
• Price to Book (P/B): 1.97
• Price to Sales (P/S): 0.00
• P/FCF Ratio: -32.99
• Enterprise Value/Market Cap: N/A
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: N/A
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: €5.32
• Price Target Upside: 1.72% Upside
• Rating Consensus: Hold
• Number of Analyst Covering: 8

Positive Factors

Dividend yield

The stock offers limited downside risk with a nearly 7% dividend yield, making it attractive for investors.

Energy transition

Gas is needed to support the energy transition, which is a positive factor for Snam.

Strategic investments

Snam has opportunities in Germany after acquiring a stake in Open Grid Europe, with a focus on green hydrogen and CO2 storage.

Negative Factors

Interest costs

The expected higher interest costs and lower contribution from equity associates partially offset the positive operating performance.

Revenue decline

FY24E revenues should decrease mainly due to much lower revenues from the energy transition.

SNAM S.p.A. Business Overview & Revenue Model

Company Description

Snam S.p.A., together with its subsidiaries, engages in the operation of natural gas transport and storage infrastructure in Italy. The company operates through Natural Gas Transportation, Liquefied Natural Gas (LNG) Regasification, and Natural Gas Storage segments. It provides natural gas transportation and dispatching services with approximately 32,700 kilometers of high-and medium-pressure gas pipelines; and owns and manages LNG regasification plants. The company also offers natural gas storage services through an integrated group of infrastructure comprising deposits, wells, gas treatment and compression plants, and the operational dispatching systems; and operates nine storage concessions, including five in Lombardy, three in Emilia-Romagna, and one in Abruzzo. In addition, it engages in the lease and maintenance of fibre optic telecommunications cables, as well as provides integrated services in the natural gas mobility sector; energy efficiency solutions for residential, industrial, tertiary, and public administration sectors; and management of biogas and biomethane plants. Further, the company offers engineering and project management services; and supervision of infrastructure planning activities. It also operates in Albania, Saudi Arabia, Austria, China, Egypt, the United Arab Emirates, France, Greece, the United Kingdom, and the United States. The company was formerly known as Snam Rete Gas S.p.A. and changed its name to Snam S.p.A. in January 2012. Snam S.p.A. was founded in 1941 and is headquartered in San Donato Milanese, Italy.

How the Company Makes Money

SNAM S.p.A. Financial Statement Overview

Summary

The company demonstrates strong profitability and operational efficiency, with robust EBIT and EBITDA margins. However, it faces challenges with declining revenues and negative free cash flow. The balance sheet reflects significant leverage, though profitability relative to equity remains strong.

Income Statement

The company has shown strong gross and net profit margins, with a gross profit margin of 87.8% and a net profit margin of 35.5% in 2024. However, the revenue has declined by 17.3% from 2023 to 2024, indicating potential challenges. EBIT and EBITDA margins remain robust at 47.2% and 87.4%, respectively, suggesting operational efficiency.

Balance Sheet

The debt-to-equity ratio is relatively high at 2.06, reflecting significant leverage, while the return on equity is strong at 14.1%, indicating good profitability relative to equity. The equity ratio is moderate at 24.9%, showing a balanced capital structure.

Cash Flow

The free cash flow has improved from -1.68 billion in 2023 to -1.00 billion in 2024, yet it remains negative, indicating cash flow challenges. The operating cash flow to net income ratio is 1.44, suggesting that operating cash flows cover the net income well, but the free cash flow to net income ratio is negative due to high capital expenditures.

Breakdown
Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement		Total Revenue
3.55B	4.29B	3.50B	3.29B	2.75B
	Gross Profit
3.12B	2.87B	2.60B	1.78B	1.70B
	EBIT
1.68B	1.42B	1.38B	1.41B	1.37B
	EBITDA
3.10B	2.42B	2.23B	2.25B	2.16B
	Net Income Common Stockholders
1.26B	1.14B	671.00M	1.50B	1.10B
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
1.81B	1.38B	1.76B	1.34B	3.04B
	Total Assets
35.79B	33.52B	32.47B	27.36B	26.13B
	Total Debt
18.36B	16.65B	13.68B	15.36B	15.94B
	Net Debt
16.55B	15.27B	11.92B	14.02B	12.89B
	Total Liabilities
27.90B	25.93B	24.95B	20.12B	19.66B
	Stockholders Equity
7.93B	7.63B	7.47B	7.20B	6.47B
Cash Flow		Free Cash Flow
-1.00B	-1.68B	2.79B	94.00M	431.00M
	Operating Cash Flow
1.81B	-135.00M	4.11B	1.34B	1.60B
	Investing Cash Flow
-2.68B	-2.23B	-1.36B	-1.64B	-1.64B
	Financing Cash Flow
1.29B	1.99B	-2.32B	-1.41B	233.00M

SNAM S.p.A. Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
0NQP		€17.54B	13.93	16.18%	5.44%	―	―
Sector *	57 Neutral	$7.23B	3.16	-4.49%	5.63%	0.82%	-49.15%
0DME		€672.88M	18.25	4.51%	4.62%	―	―
0HXB		€16.30B	9.95	10.53%	4.95%	―	―
0LBM		€17.94B	16.87	19.05%	3.86%	―	―
I10		€6.93B	12.20	20.21%	5.64%	―	―
SPEA		€4.58B	14.77	12.44%	7.40%	―	―