HERA S.p.A. (HER) AI Stock Analysis

• Market Cap: €5.84B
• Dividend Yield: 3.76%
• Average Volume (3M): 2.57M
• Price to Earnings (P/E): 11.4
• Beta (1Y): 0.44
• Revenue Growth: 15.98%
• EPS Growth: 19.01%
• Country: IT
• Employees: 9,832
• Sector: Utilities
• Sector Strength: 65
• Industry: Diversified Utilities
• EPS (TTM): 0.04
• Shares Outstanding: 1,489,538,700
• 10 Day Avg. Volume: 2,419,885
• 30 Day Avg. Volume: 2,569,058
• PEG Ratio: 1.03
• Price to Book (P/B): 1.34
• Price to Sales (P/S): 0.38
• P/FCF Ratio: -677.51
• 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: €4.70
• Price Target Upside: 17.79% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 1
• EPS Forecast (FY): N/A
• Revenue Forecast (FY): N/A

• Rating: 62 Neutral
• Price Target: €4.00 ▲(0.25% Upside)

HERA S.p.A.'s overall stock score is driven by its mixed financial performance and technical indicators. While the company maintains stable profitability and a fair valuation, it faces challenges with declining revenue and cash flow. Technical analysis suggests weak momentum, but the stock's valuation and dividend yield offer some support.

Positive Factors

Business Model Strength

HERA's diversified revenue streams from water, waste, and energy services provide stability and resilience against sector-specific downturns.

Competitive Advantages

Continuous investment in infrastructure enhances operational efficiency and service quality, strengthening HERA's competitive position.

Regulatory Support

Supportive regulatory frameworks ensure stable pricing, providing predictable revenue streams and reducing financial volatility.

Negative Factors

Declining Revenue

Significant revenue decline indicates potential market challenges or operational inefficiencies, impacting long-term growth prospects.

Cash Flow Challenges

Declining free cash flow limits the company's ability to invest in growth opportunities and manage debt, affecting financial health.

Rising Debt Levels

Moderate leverage suggests potential financial risk, necessitating careful debt management to maintain balance sheet stability.

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

Company Description

Hera S.p.A., a multi-utility company, engages in the waste management, water services, and energy businesses in Italy. It engages in the sale and distribution of methane and natural gas, as well as in the district heating and heating management business; generation, distribution, and sale of electricity; aqueduct, purification, and sewage services related to water; waste collection, treatment, recycling, and disposal services; and provision of public lighting, telecommunications, and other services. The company's water services include activities related to water collection, drinking water treatment, and distribution for civil and industrial applications, as well as sewerage and sewage treatment activities; and environmental services comprise sweeping, waste collection, transport, and recovery and disposal. It manages water services in 227 municipalities and serves a catchment area of approximately 3.6 million inhabitants with a water network of 35.080 kilometers; and provides gas with a network covering approximately 19,953 kilometers. The company was founded in 2002 and is headquartered in Bologna, Italy.

How the Company Makes Money

HERA S.p.A. generates revenue through multiple streams, primarily from its utility services. The company earns income from water supply and treatment, waste management services, and energy sales, including both electricity and gas. Each of these segments contributes significantly to its overall revenue. Additionally, HERA invests in infrastructure development and maintenance, which allows it to enhance efficiency and service quality while capturing additional market share. The company also benefits from regulatory frameworks that support utility pricing, ensuring stable and predictable revenue. Strategic partnerships with local governments and private entities for service contracts further bolster its earnings potential, as do initiatives aimed at expanding its service offerings in renewable energy and environmental sustainability.

HERA S.p.A. Financial Statement Overview

Summary

HERA S.p.A. demonstrates solid financial performance with stable profitability and effective cost management. The company has shown resilience in revenue growth and improved cash flow generation. While leverage is moderate, maintaining a balanced capital structure is crucial for future stability.

Income Statement

HERA S.p.A. shows a stable gross profit margin of around 41% in TTM, indicating efficient cost management. The net profit margin has slightly decreased to 3.5% in TTM, reflecting some pressure on profitability. Revenue growth is modest at 1.5% in TTM, recovering from previous declines. EBIT and EBITDA margins are stable, suggesting consistent operational performance.

Balance Sheet

The debt-to-equity ratio is 1.39 in TTM, indicating moderate leverage. Return on equity is healthy at 13.6%, showing effective use of equity. The equity ratio is stable, reflecting a balanced capital structure. However, the company should monitor its debt levels to maintain financial stability.

Cash Flow

Operating cash flow is strong, with a significant increase in TTM. Free cash flow has improved dramatically, showing a positive growth rate. The operating cash flow to net income ratio is 0.27, indicating good cash generation relative to earnings. However, the free cash flow to net income ratio is lower, suggesting room for improvement in cash flow management.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	14.24B	13.06B	15.41B	19.87B	10.56B	7.08B
Gross Profit	5.67B	5.37B	4.47B	1.33B	1.48B	1.29B
EBITDA	1.57B	1.46B	1.36B	1.01B	1.02B	971.70M
Net Income	506.30M	494.50M	441.40M	255.20M	333.50M	302.70M
Balance Sheet
Total Assets	14.14B	15.06B	15.08B	17.12B	14.03B	11.03B
Cash, Cash Equivalents and Short-Term Investments	1.02B	1.36B	1.40B	1.98B	932.50M	1.14B
Total Debt	84.00M	4.79B	4.73B	5.68B	3.35B	3.72B
Total Liabilities	9.96B	11.07B	11.33B	13.47B	10.61B	7.88B
Stockholders Equity	3.87B	3.68B	3.44B	3.40B	3.20B	2.96B
Cash Flow
Free Cash Flow	196.90M	-7.30M	756.90M	-673.80M	456.70M	385.00M
Operating Cash Flow	1.16B	853.00M	1.57B	35.70M	1.05B	891.40M
Investing Cash Flow	-1.01B	-804.60M	-857.40M	-758.40M	-662.60M	-518.60M
Financing Cash Flow	-70.00M	-65.60M	-1.32B	1.78B	-484.30M	250.30M

HERA S.p.A. Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 3.99
• 50DMA: Negative
• 100DMA: Positive
• 200DMA: Positive
• MACD: Positive
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For IT:HER, the sentiment is Positive. The current price of 3.99 is below the 20-day moving average (MA) of 4.03, below the 50-day MA of 4.01, and above the 200-day MA of 3.91, indicating a neutral trend. The MACD of -0.01 indicates Positive momentum. The RSI at 47.44 is Neutral, neither overbought nor oversold. The STOCH value of 54.55 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for IT:HER.

HERA S.p.A. Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
ERG	69 Neutral	€3.24B	23.19	6.61%	4.61%	-3.04%	-39.96%
ENEL	67 Neutral	€89.06B	13.95	23.22%	5.05%	-3.10%	26.28%
A2A	66 Neutral	€7.17B	9.79	13.23%	4.37%	8.61%	-22.69%
Sector *	66 Neutral	$17.65B	18.10	5.60%	3.62%	6.62%	11.55%
ACE	64 Neutral	€4.66B	10.09	14.57%	4.33%	-26.96%	25.00%
HER	62 Neutral	€5.84B	11.45	13.77%	3.76%	15.98%	19.01%
IRE	61 Neutral	€3.25B	11.03	9.51%	5.06%	10.48%	9.06%

HERA S.p.A. Corporate Events

Hera Group Reports Strong Q3 2025 Results with Revenue and Profit Growth

Hera Group reported strong financial performance for the first nine months of 2025, with a 10.6% increase in revenues and a 4.2% rise in net profit attributable to shareholders. The company continues to grow through strategic investments and acquisitions, enhancing its multi-business industrial model and maintaining financial stability, which supports further development opportunities.