Saturday 28 November 2015

Enel report Q3 2015

Enel, Q3, 2015, report, front page

My greenish energy producer Enel arrived with their report. Enel had a bit of a share price drop during spring-summer but are now up above 4 € again. I was thinking about increasing the position when they were down around 3.7 € (because my initial investment was so small) but I never got around to it and it seems as if I never have the money to do so. It seems to be a never ending story with my companies and there is always one of them dropping like a stone and I then feel forced to buy that one instead so I never get to water the flowers.

One should however not despair. There will come other moments in the future when I will have the cash and I will be able to make those investments that I really want to do and not the ones I feel forced to do. I am looking forward to that day. I am however amazed at how long some companies can remain in a very pushed down state. As an example the average P/B for European Banks since the last 30 years have been 1.87. The German banks are still seven years after the financial crises being traded at P/B around 0.5-0.6 and to be frank they have not managed to turn around yet so it is fine but I would never for the life of me have expected it to take so long time.

Sorry for the interlude of the quarter report summary.

For the report in full please click here and for the previous summary then visit Enel report Q2 2015 and to get a better feeling for Enel then please take a look at analysis of Enel 2015.

Taking a closer look at the financial statement below then we see that also Enel had a tougher period but far, far from what they other guys have had. The sales are up by 3.7% which is ok but also less than for instance Cez but their costs are on the other hand up by only (compared to the others) 6.4% so that gives them a much smoother result and they are flat compared to back in 2014. Last year they paid out 14 cents per share and by the look of it Enel is the only company that are in Q3 above in earnings compared to what they paid out last year.

Enel, Q3, 2015, financial statement

Enel are out shopping a little. They are taking shares in large wind and solar plants and one of their latest investments is a wind power plant in India. Call me crazy but I kind of prefer when the energy producers have production into the same electrical net. This might be stupid of me because one day the entire world will probably be one electrical net and the survivors (the electrical producers that will survive the competition) will have to be extremely global.

Conclusion: Enel is doing like they did last year up until this quarter and now, fingers crossed, they will hopefully not arrive with any massive impairment costs like they did last year... future will tell. From what I have seen in E.On. there seem to be no end to the impairment costs that one can take so I will be happily surprised if nothing appears in Enel during the final quarter. Oh... and the same there goes for Cez, E.On and RWE. I will remains as a shareholder in Enel and still hope that they will drop down at a moment when I have cash available so that I can buy some more.

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