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Terna (TEZNY)
OTHER OTC:TEZNY
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Terna
(OTC:TEZNY)
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Rating:77Outperform
Price Target:
$36.00
▲(9.39% Upside)
Terna's overall stock score is driven by strong earnings call results and positive technical indicators. The company's robust profitability and growth are tempered by concerns over high leverage and cash flow challenges. The valuation is fair, and the earnings call provided a positive outlook despite some concerns. These factors combine to give Terna a solid stock score.
Positive Factors
Infrastructure Progress
Advancements in infrastructure projects enhance Terna's ability to meet future energy demands and support sustainable growth, strengthening its market position.
Strong Financial Performance
Consistent revenue and EBITDA growth indicate robust operational efficiency and profitability, supporting long-term financial health and shareholder value.
High Procurement Coverage
Securing procurement contracts mitigates supply chain risks, ensuring project continuity and cost management, which are crucial for strategic execution.
Negative Factors
Increased Net Debt
Rising net debt levels can strain financial flexibility, potentially impacting future investment capacity and increasing vulnerability to interest rate changes.
Stagnant Renewable Energy Contribution
Lack of growth in renewable energy contribution may hinder Terna's efforts to align with sustainability trends and regulatory expectations, affecting long-term competitiveness.
Cash Flow Challenges
Negative free cash flow due to high CapEx could limit liquidity and reinvestment capabilities, posing risks to financial stability and growth initiatives.
Terna (TEZNY) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$21.42B
Dividend Yield3.78%
Average Volume (3M)1.44K
Price to Earnings (P/E)17.8
Beta (1Y)-0.04
Revenue Growth10.80%
EPS Growth9.07%
CountryUS
Employees6,376
SectorUtilities
Sector Strength65
IndustryRegulated Electric
Share Statistics
EPS (TTM)N/A
Shares Outstanding669,997,300
10 Day Avg. Volume748
30 Day Avg. Volume1,441
Financial Highlights & Ratios
PEG Ratio0.70
Price to Book (P/B)2.02
Price to Sales (P/S)4.18
P/FCF Ratio-13.18
Enterprise Value/Market Cap1.40
Enterprise Value/Revenue15.23
Enterprise Value/Gross Profit17.61
Enterprise Value/Ebitda14.34
Forecast
1Y Price TargetN/A
Price Target UpsideN/A
Rating ConsensusN/A
Number of Analyst Covering0
EPS Forecast (FY)N/A
Revenue Forecast (FY)N/A
Terna Business Overview & Revenue Model
Company DescriptionTerna - 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 MoneyTerna generates revenue primarily through the regulated transmission of electricity, which involves charging fees to electricity suppliers for using its grid infrastructure. This revenue model is supplemented by income from ancillary services, which include balancing and dispatching electricity to ensure grid stability. Additionally, Terna earns revenues from investments in infrastructure projects, often supported by government incentives for renewable energy integration. The company may also engage in international projects and partnerships that expand its operational footprint and revenue potential. Key partnerships with energy producers and regulatory bodies further bolster its earnings by facilitating the integration of new technologies and sustainable practices in electricity transmission.
Terna Earnings Call Summary
Earnings Call Date:Nov 13, 2025
(Q3-2025)
| % Change Since: |
Next Earnings Date:Mar 25, 2026
Earnings Call Sentiment Positive
The earnings call presented a generally positive outlook with strong financial performance, significant progress in infrastructure projects, and high procurement coverage. However, there are concerns about flat renewable contributions and increased net debt.Q3-2025 Updates
Positive Updates
Significant Infrastructure Progress
Terna made considerable progress in grid development projects such as the Tyrrhenian Link, Central Link, and Sardinian Link, which include innovative designs and advanced technology for sustainable growth.
Strong Financial Performance
Group revenues and EBITDA increased by 9% and 7%, respectively, in the first 9 months of 2025, with a group net income of EUR 853 million, reflecting a 5% growth compared to the previous year.
Record CapEx Growth
Group CapEx reached around EUR 2.1 billion, marking a 23% increase compared to the first 9 months of last year, setting a new record in Terna's history.
High Procurement Coverage
88% of the 2024-'28 CapEx plan is already covered by procurement contracts, indicating effective management of potential supply chain risks.
Successful Storage Auction
The first auction under the MACSE framework awarded 10 gigawatt hour of storage capacity, confirming strong market interest with bids exceeding demand by more than 4x.
Negative Updates
Stagnant Renewable Energy Contribution
Renewable sources covered about 43% of national demand, remaining in line with the previous year, with no significant increase in renewable's share of total production.
Flat Interim Dividend
The 2025 interim dividend was approved at EUR 11.92 per share, remaining flat compared to the previous year's interim dividend.
Increased Net Debt
Net debt at the end of September 2025 stood at EUR 11.7 billion, which is around EUR 500 million higher than the 2024 year-end level, primarily due to CapEx acceleration and dividend payment.
Company Guidance
During the call, Terna provided guidance for the full year 2025, confirming expectations of achieving revenues of EUR 4.03 billion, EBITDA of EUR 2.7 billion, and a net profit of EUR 1.08 billion. The company set a target of approximately EUR 3.4 billion in investments for the year. Despite already achieving around 80% of the full-year net income guidance in the first nine months, the guidance remains unchanged due to pending visibility on certain elements, such as dispatching incentives. The company reported a 9% increase in group revenues and a 7% rise in EBITDA for the first nine months of 2025, with group net income reaching EUR 853 million, a 5% growth compared to the same period last year. Terna's net debt stood at EUR 11.7 billion as of September 2025, with a significant portion of the 2024-'28 CapEx plan already secured with procurement contracts. The strong results were accompanied by significant progress in grid development projects like the Tyrrhenian Link and advancements in energy storage capacity, reflecting Terna's commitment to infrastructure and energy transition initiatives.Terna Financial Statement Overview
Summary
Terna shows strong profitability and growth in its income statement, with efficient operations. However, the balance sheet is burdened by high leverage, and cash flow analysis reveals challenges in free cash flow due to substantial capital expenditures. Overall, Terna presents a mixed financial picture, with significant strengths in profitability but areas of concern in cash flow and leverage.Income Statement
Terna demonstrates strong profitability with a consistent increase in revenue over the years. The gross profit margin for 2024 is high, reflecting efficient cost management. The net profit margin has also improved, indicating healthy bottom-line growth. EBIT and EBITDA margins are strong, showcasing operational efficiency. Overall, the income statement reflects robust financial health and growth trajectory.85
Very Positive
Balance Sheet
Terna's balance sheet is characterized by a high debt-to-equity ratio, reflecting significant leverage, which could pose risks in adverse market conditions. However, the company maintains a reasonable equity ratio, indicating a stable financial foundation. The return on equity is impressive, demonstrating effective use of equity to generate profits. Overall, while leverage is a concern, the company's equity position remains solid.72
Positive
Cash Flow
The cash flow statement reveals challenges with free cash flow, which is negative, indicating high capital expenditures. However, operating cash flow is strong relative to net income, showing effective cash generation from operations. The free cash flow to net income ratio is unfavorable, suggesting potential issues with liquidity and reinvestment capabilities. Overall, Terna's cash flow health is mixed, with strengths in operational cash generation but weaknesses in free cash flow.68
Positive
| 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 | 2.76B | 1.74B | 2.41B | 2.55B | 3.31B |
| Total Debt | 14.75B | 13.86B | 12.98B | 10.81B | 12.42B | 12.59B |
| 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 | -1.36B | -2.40B | -2.33B | -1.86B | -863.30M | -1.39B |
| Financing Cash Flow | 320.67M | 1.87B | 464.30M | 92.50M | -1.05B | 2.08B |
Terna Technical Analysis
Positive
32.91
Price Trends
31.44
Positive
30.79
Positive
29.86
Positive
Market Momentum
0.26
Positive
52.91
Neutral
27.50
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TEZNY, the sentiment is Positive. The current price of 32.91 is above the 20-day moving average (MA) of 31.93, above the 50-day MA of 31.44, and above the 200-day MA of 29.86, indicating a bullish trend. The MACD of 0.26 indicates Positive momentum. The RSI at 52.91 is Neutral, neither overbought nor oversold. The STOCH value of 27.50 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for TEZNY.
Terna Peers Comparison
UnderperformOutperform
Sector (66)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
78 Outperform | $23.71B | 8.07 | 19.13% | 5.68% | 4.43% | 123.35% | |
77 Outperform | $21.42B | 17.83 | 19.03% | 3.78% | 10.80% | 9.07% | |
72 Outperform | $23.40B | 4.08 | 18.75% | 0.29% | 0.52% | 111.63% | |
67 Neutral | $21.58B | 20.47 | 12.34% | 3.10% | 10.96% | -0.77% | |
66 Neutral | $26.24B | 19.22 | 8.65% | 4.54% | 13.12% | ― | |
66 Neutral | $26.28B | 24.18 | 7.65% | 3.13% | 8.42% | 32.48% | |
66 Neutral | $17.65B | 18.10 | 5.60% | 3.62% | 6.62% | 11.55% |
* Utilities Sector Average
TEZNY
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38.41%
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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.