RWE AG (RWEOY) AI Stock Analysis

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RWE AG

(OTC:RWEOY)

Rating:71Outperform

Price Target:

$45.00

▲(9.49% Upside)

RWE AG's overall stock score is driven by strong financial performance and a positive earnings call outlook, despite technical indicators suggesting short-term weakness. The attractive valuation further supports the score, while challenges in revenue and free cash flow management pose risks.

RWE AG (RWEOY) vs. SPDR S&P 500 ETF (SPY)

Market Cap

$30.09B

Dividend Yield3.04%

Average Volume (3M)42.08K

Price to Earnings (P/E)10.4

Beta (1Y)0.10

Revenue Growth-7.47%

EPS Growth-24.61%

CountryUS

Employees20,985

SectorUtilities

Sector Strength62

IndustryDiversified Utilities

Share Statistics

EPS (TTM)1.06

Shares Outstanding743,841,200

10 Day Avg. Volume4,995

30 Day Avg. Volume42,082

Financial Highlights & Ratios

PEG RatioN/A

Price to Book (P/B)N/A

Price to Sales (P/S)N/A

P/FCF RatioN/A

Enterprise Value/Market Cap1.57

Enterprise Value/Revenue2.05

Enterprise Value/Gross Profit6.43

Enterprise Value/Ebitda5.67

Forecast

1Y Price Target

$49.23

Price Target Upside19.78% Upside

Rating ConsensusModerate Buy

Number of Analyst Covering1

RWE AG Business Overview & Revenue Model

Company DescriptionRWE AG is a leading European energy company based in Germany, primarily engaged in the generation and distribution of electricity and gas. The company operates through various segments, including Renewables, Conventional Power Generation, Energy Trading, and Retail. RWE is a major player in the renewable energy sector, focusing on wind and solar power, while also maintaining a significant portfolio of conventional power plants, including fossil and nuclear energy sources.

How the Company Makes MoneyRWE AG generates revenue through several key streams. The largest share comes from its Renewable segment, where the company invests in and operates wind and solar energy projects, benefitting from government incentives and long-term power purchase agreements (PPAs). Additionally, the Conventional Power Generation segment contributes revenue by supplying electricity from its existing power plants to the grid, often through contracts with utilities and large industrial consumers. RWE's Energy Trading division engages in the buying and selling of energy commodities, including electricity, gas, and certificates, which helps to optimize its portfolio and generate additional income. Furthermore, the Retail segment provides energy supply solutions to residential and commercial customers, contributing to its overall earnings. Strategic partnerships and joint ventures with other energy firms and investments in emerging technologies also play a significant role in RWE's revenue generation.

RWE AG Earnings Call Summary

Earnings Call Date:Aug 14, 2025

(Q2-2025)

% Change Since: |

Next Earnings Date:Nov 12, 2025

Earnings Call Sentiment Positive

The earnings call reflects a generally positive outlook with strong financial performance, progress in construction projects, and favorable developments in core markets offset by challenges related to weak wind conditions, low trading results, and uncertainties in the US market.

Q2-2025 Updates

Positive Updates

Strong Financial Performance Despite Challenges

RWE delivered a good financial performance in the first half of 2025 with adjusted EBITDA at EUR 2.1 billion and adjusted net income at EUR 0.8 billion, reaching 50% of the full year guidance midpoint.

Construction Program Progress and Milestones

Around 11 gigawatts of capacity are under construction with more than 3 gigawatts expected to become operational in the second half of 2025. Key projects like the Sofia project in the UK and Thor in Denmark are progressing as planned.

Attractive Shareholder Returns

RWE is on track to deliver an 18% EPS CAGR to 2027, with a 13% target to 2030. The company also plans an annual dividend increase of 5% to 10% and is executing a EUR 1.5 billion share buyback program.

Positive Developments in Core Markets

RWE sees improved investment frameworks in the UK, with the AR7 auction rules favoring renewable energy strategies, and in Germany, with policies focused on cost efficiency and security of supply.

Strong US Market Potential

The passage of The Big Beautiful Bill in the US provides continued tax support for build-out, with RWE maintaining strict investment criteria to leverage opportunities.

Negative Updates

Weak Wind Conditions and Low Trading Results

The first half of 2025 was marked by weak wind conditions in Europe and low trading results, affecting the financial performance of the Offshore Wind and Supply & Trading segments.

Challenges in Achieving Guidance

RWE's net income was only 50% of the full-year guidance in the first half, compared to 75%-80% in previous years, raising concerns about meeting the guidance for the full year.

Uncertainty in US Investments

RWE awaits clarity on tax credit eligibility and tariff risks in the US, which could delay investments despite the positive market environment.

Company Guidance

In the RWE conference call discussing the first half of fiscal year 2025, key financial metrics were highlighted. RWE's adjusted EBITDA for H1 2025 was reported at EUR 2.1 billion, with adjusted net income at EUR 0.8 billion, and adjusted earnings per share at EUR 1.1. The company confirmed its full-year guidance, expecting adjusted EBITDA between EUR 4.55 billion and EUR 5.15 billion, adjusted net income from EUR 1.3 billion to EUR 1.8 billion, and adjusted EPS between EUR 1.8 and EUR 2.5. RWE's share buyback program is progressing, with EUR 500 million completed and a total of EUR 1.5 billion planned by Q2 2026. The company is also advancing its construction program, with 11 gigawatts under construction and over 3 gigawatts expected to begin commercial operation in H2 2025. The guidance reflects confidence in delivering robust earnings despite challenges such as weak wind conditions and low trading results in Europe during the first half of the year.

RWE AG Financial Statement Overview

Summary

RWE AG shows strong net income growth and improved profit margins despite revenue challenges. The balance sheet is stable with a slight increase in leverage, and cash flow from operations is strong, though high capital expenditures result in negative free cash flow.

Income Statement

Positive

RWE AG has demonstrated strong net income growth, with a substantial improvement from €1.45 billion in 2023 to €5.135 billion in 2024. However, the company faced a decline in total revenue, which decreased from €34.516 billion in 2023 to €24.224 billion in 2024, indicating a challenging revenue environment. The gross profit margin in 2024 was approximately 35.7%, a steady figure for the industry. Despite the revenue decline, the EBITDA margin improved significantly, reflecting efficient cost management.

Balance Sheet

Positive

The company's balance sheet shows a relatively stable structure with total assets decreasing slightly from €106.512 billion in 2023 to €98.44 billion in 2024. The debt-to-equity ratio increased slightly, indicating a moderate leveraging of equity. Stockholders' equity remained stable, ensuring a solid equity base. The equity ratio was approximately 32% in 2024, demonstrating a healthy level of equity financing for the industry.

Cash Flow

Positive

RWE AG's cash flow from operations increased, indicating improved cash generation capabilities. However, the company reported negative free cash flow due to significant capital expenditures, which could pressure cash liquidity if this trend continues. The operating cash flow to net income ratio was strong, suggesting good cash conversion from earnings. Nevertheless, the free cash flow to net income ratio was negative, highlighting the impact of high capital investments.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	23.07B	24.22B	34.52B	38.37B	24.53B	13.69B
Gross Profit	7.34B	8.65B	14.04B	6.69B	6.34B	3.47B
EBITDA	8.32B	10.68B	9.44B	2.91B	4.39B	1.59B
Net Income	2.58B	5.13B	1.45B	2.72B	721.00M	1.05B
Balance Sheet
Total Assets	97.81B	98.44B	106.51B	138.55B	142.31B	61.67B
Cash, Cash Equivalents and Short-Term Investments	9.27B	11.94B	14.64B	20.46B	13.87B	8.99B
Total Debt	0.00	15.79B	13.67B	15.62B	12.11B	3.35B
Total Liabilities	61.25B	64.82B	73.35B	109.27B	125.31B	43.70B
Stockholders Equity	33.05B	31.55B	31.57B	27.58B	15.25B	17.18B
Cash Flow
Free Cash Flow	-5.86B	-2.76B	-5.74B	-2.08B	3.58B	817.00M
Operating Cash Flow	5.03B	6.62B	4.24B	2.41B	7.27B	4.17B
Investing Cash Flow	-11.26B	-9.71B	-2.81B	-9.89B	-7.74B	-4.35B
Financing Cash Flow	4.13B	1.12B	-1.56B	8.62B	1.46B	1.77B

RWE AG Technical Analysis

Technical Analysis Sentiment

Positive

Last Price41.10

Price Trends

50DMA

41.70

Negative

100DMA

39.84

Positive

200DMA

35.60

Positive

Market Momentum

MACD

-0.44

Positive

RSI

43.71

Neutral

STOCH

11.84

Positive

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For RWEOY, the sentiment is Positive. The current price of 41.1 is above the 20-day moving average (MA) of 40.92, below the 50-day MA of 41.70, and above the 200-day MA of 35.60, indicating a neutral trend. The MACD of -0.44 indicates Positive momentum. The RSI at 43.71 is Neutral, neither overbought nor oversold. The STOCH value of 11.84 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for RWEOY.

RWE AG Peers Comparison

Overall Rating

UnderperformOutperform

Sector (66)

Financial Indicators

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
CIG	79 Outperform	$6.54B	4.95	22.94%	15.50%	-3.27%	-3.44%
ELP	72 Outperform	$6.40B	12.36	9.81%	6.23%	-5.28%	14.50%
RWEOY	71 Outperform	$30.09B	10.35	7.69%	3.04%	-7.47%	-24.61%
SRE	71 Outperform	$53.58B	19.91	8.87%	3.08%	0.46%	-11.77%
Sector *	66 Neutral	$17.25B	17.99	5.54%	3.64%	6.63%	11.55%
AES	65 Neutral	$9.55B	9.47	21.17%	5.42%	-3.19%	30.48%
BIP	63 Neutral	$20.51B	1,620.62	1.06%	5.56%	8.86%	―

* Utilities Sector Average

Performance Comparison

RWEOY

RWE AG

41.10

5.44

15.26%

BIP

Brookfield Infrastructure

30.51

1.00

3.39%

CIG

Companhia Energetica Minas Gerais

2.04

0.15

7.94%

ELP

Companhia Paranaense de Energia Pfd

9.12

1.81

24.76%

SRE

Sempra Energy

81.11

1.60

2.01%

AES

12.93

-2.35

-15.38%

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: Sep 05, 2025