Terna S.p.A. (TRN) AI Stock Analysis

• Market Cap: €18.10B
• Dividend Yield: 4.36%
• Average Volume (3M): 3.58M
• Price to Earnings (P/E): 16.4
• Beta (1Y): 0.29
• Revenue Growth: 10.18%
• EPS Growth: 8.43%
• Country: IT
• Employees: 6,376
• Sector: Utilities
• Sector Strength: 65
• Industry: Regulated Electric
• EPS (TTM): 0.16
• Shares Outstanding: 2,009,992,000
• 10 Day Avg. Volume: 3,751,325
• 30 Day Avg. Volume: 3,582,329
• PEG Ratio: 0.71
• Price to Book (P/B): 2.04
• Price to Sales (P/S): 4.20
• P/FCF Ratio: -13.25
• 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: €8.67
• Price Target Upside: -4.30% Downside
• Rating Consensus: Hold
• Number of Analyst Covering: 5

• Rating: 72 Outperform
• Price Target: €9.50 ▲(4.86% Upside)

Terna S.p.A. receives a solid score driven by strong financial performance, characterized by robust revenue growth and profitability. The valuation is reasonable with an attractive dividend yield. Technical analysis presents mixed signals, indicating a neutral market sentiment. The absence of earnings call data and corporate events does not impact the score.

Positive Factors

Negative Factors

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

Company Description

Terna - Rete Elettrica Nazionale Società per Azioni, together with its subsidiaries, engages in the electricity transmission and dispatching activities in Italy, Euro-area countries, and internationally. The company operates through Regulated, Non-Regulated, and International segments. It is involved in the planning, development, management, operation, and maintenance of national transmission grid, electricity infrastructures, and high-voltage infrastructures. The company also offers telecommunications systems and equipment, connectivity services, energy solutions, and operation and maintenance services. In addition, it designs, produces, commercializes, and repairs power transformers for electricity transmission and distribution grids, industrial transformers for the steel and metals industries, and special transformers for convertors used in electrochemical production; designs, produces, and supplies marine and terrestrial cables; implements and develops renewable energy projects; and undertakes private interconnector projects, as well as owns the national transmission grid. The company was founded in 1999 and is headquartered in Rome, Italy.

How the Company Makes Money

Terna generates revenue primarily through the transmission of electricity over its high-voltage grid, charging fees to electricity producers and distributors for the use of its infrastructure. The company earns significant income from regulated tariffs set by the Italian regulatory authority, which govern the prices it can charge for its services. Additionally, Terna benefits from ancillary services, which are necessary for maintaining grid stability and reliability, and it receives compensation for these services from electricity market participants. Partnerships with other energy companies and investments in renewable energy projects also contribute to its revenue streams, as Terna seeks to enhance its network's capabilities to accommodate a growing share of renewables.

Terna S.p.A. Financial Statement Overview

Summary

Terna S.p.A. demonstrates strong financial health with robust revenue growth, high profitability margins, and effective capital management. The balance sheet is stable, despite high leverage typical of the utilities sector. Cash flow generation is solid, although negative free cash flow due to high capital expenditures should be monitored.

Income Statement

Terna S.p.A. has exhibited strong revenue growth with a steady trajectory over recent years, increasing from €2.32 billion in 2019 to €3.68 billion in 2024. The company maintains high gross and net profit margins, consistently above industry averages, with a gross profit margin of 82.06% and a net profit margin of 28.84% in 2024. This indicates efficient cost management and robust profitability. EBIT and EBITDA margins also reflect solid operational performance. Overall, the income statement shows a positive growth trend and strong profitability.

Balance Sheet

Terna's balance sheet reveals a strong equity position with an equity ratio of 27.68% in 2024, indicating a high level of asset financing through equity. The debt-to-equity ratio stands at 1.84, reflecting significant leverage but is manageable within the utility sector norms. Return on equity is robust at 14.11%, signaling effective use of shareholder funds to generate profits. The balance sheet is stable with a healthy mix of debt and equity financing, though high leverage requires monitoring for potential risks.

Cash Flow

Terna's cash flow statement indicates stable operating cash flows relative to net income, with a ratio of 1.38 in 2024, suggesting strong cash generation capabilities. However, free cash flow is negative due to substantial capital expenditures, which are common in the utilities sector for infrastructure investments. While free cash flow growth is a concern, the company maintains positive operating cash flows, supporting ongoing operations and dividend commitments.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	1.96B	3.65B	3.15B	2.92B	2.57B	2.40B
Gross Profit	1.70B	3.34B	2.58B	2.42B	2.16B	2.06B
EBITDA	2.08B	2.57B	2.11B	2.04B	1.83B	1.73B
Net Income	829.50M	1.06B	885.40M	857.00M	789.40M	785.50M
Balance Sheet
Total Assets	28.08B	27.19B	23.47B	22.83B	22.39B	20.70B
Cash, Cash Equivalents and Short-Term Investments	2.83B	2.74B	1.74B	2.41B	2.55B	3.31B
Total Debt	14.75B	13.86B	12.98B	11.76B	12.42B	12.34B
Total Liabilities	20.55B	19.64B	17.10B	16.63B	17.60B	16.28B
Stockholders Equity	7.51B	7.52B	6.32B	5.15B	4.68B	4.37B
Cash Flow
Free Cash Flow	-1.37B	-1.16B	-963.90M	831.40M	-511.90M	-245.20M
Operating Cash Flow	695.70M	1.47B	1.08B	2.32B	832.30M	941.40M
Investing Cash Flow	-2.40B	-2.40B	-2.33B	-1.86B	-863.30M	-1.39B
Financing Cash Flow	1.07B	1.87B	464.30M	92.50M	-1.05B	2.08B

Terna S.p.A. Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 9.06
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Negative
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For IT:TRN, the sentiment is Positive. The current price of 9.06 is above the 20-day moving average (MA) of 8.82, above the 50-day MA of 8.63, and above the 200-day MA of 8.27, indicating a bullish trend. The MACD of 0.15 indicates Negative momentum. The RSI at 73.47 is Negative, neither overbought nor oversold. The STOCH value of 73.56 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for IT:TRN.

Terna S.p.A. Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
TRN	72 Outperform	€18.10B	16.37	19.67%	4.36%	10.18%	8.43%
ENI	71 Outperform	€45.18B	18.44	5.02%	6.38%	-6.68%	-33.67%
SRG	70 Outperform	€17.62B	12.62	17.62%	5.42%	-8.04%	30.49%
ARN	70 Outperform	€1.03B	12.26	26.22%	3.02%	30.89%	143.25%
Sector *	66 Neutral	$17.65B	18.10	5.60%	3.62%	6.62%	11.55%

Terna S.p.A. Corporate Events

Terna S.p.A. Advances Share Buyback Program

Terna S.p.A. announced the purchase of 835,100 of its own shares on the Euronext Milan Market, as authorized by its shareholders. This move is part of a broader strategy to support its Performance Share Plan for 2025-2029, reflecting the company’s ongoing efforts to manage its capital structure and enhance shareholder value.

The most recent analyst rating on (IT:TRN) stock is a Buy with a EUR9.50 price target. To see the full list of analyst forecasts on Terna S.p.A. stock, see the IT:TRN Stock Forecast page.

Terna Launches ESG-Linked Share Buyback Program

Terna S.p.A. has announced the initiation of an ESG-linked share buyback program, which will run from September 8 to November 7, 2025, with a maximum expenditure of 9 million euros. This program aims to support the Performance Share Plan 2025-2029 and is part of Terna’s strategy to reinforce its commitment to sustainability, benefiting its stakeholders by linking share buybacks to the achievement of specific ESG objectives.

The most recent analyst rating on (IT:TRN) stock is a Hold with a EUR9.00 price target. To see the full list of analyst forecasts on Terna S.p.A. stock, see the IT:TRN Stock Forecast page.

Terna Releases Half-Year Financial Report for 2025

Terna S.p.A. has announced the availability of its Half-Year Financial Report for the period ending June 30, 2025, following approval by its Board of Directors. The report, which includes an audit review, is accessible to the public through the company’s website and other authorized platforms, reflecting Terna’s commitment to transparency and regulatory compliance.

The most recent analyst rating on (IT:TRN) stock is a Hold with a EUR9.25 price target. To see the full list of analyst forecasts on Terna S.p.A. stock, see the IT:TRN Stock Forecast page.

Terna S.p.A. Achieves Record Investments and Financial Growth in H1 2025

Terna S.p.A. reported significant growth in its financial performance for the first half of 2025, with revenues increasing by 8% and investments reaching over 1.3 billion euros, marking a 26.6% rise compared to the previous year. This investment surge underscores Terna’s strategic focus on enhancing the national electric system’s safety and facilitating the energy transition, reflecting positively on its industrial plan and stakeholder confidence.

The most recent analyst rating on (IT:TRN) stock is a Hold with a EUR9.25 price target. To see the full list of analyst forecasts on Terna S.p.A. stock, see the IT:TRN Stock Forecast page.

Terna S.p.A. Launches First European Green Bond

Terna S.p.A. successfully launched its first European Green Bond, raising 750 million euros with a six-year duration and a 3% coupon. The bond, part of Terna’s Euro Medium Term Notes Program, received strong market interest, with demand nearly five times the offer, and will fund eligible green projects, supporting Terna’s strategy of combining sustainability with growth.

The most recent analyst rating on (IT:TRN) stock is a Hold with a EUR9.25 price target. To see the full list of analyst forecasts on Terna S.p.A. stock, see the IT:TRN Stock Forecast page.