Snam SpA (SNMRY) AI Stock Analysis

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Snam SpA

(OTC:SNMRY)

77Outperform

Snam SpA's overall stock score is driven by a robust earnings call performance and strong technical indicators. The company's financial stability, despite challenges in revenue growth and high debt levels, contributes positively, as does its reasonable valuation and attractive dividend yield. The strategic acquisitions and regulatory updates provide confidence in future prospects, though potential pressure on gas prices remains a concern.

Snam SpA (SNMRY) vs. S&P 500 (SPY)

Market Cap

$18.61B

Dividend Yield3.18%

Average Volume (3M)2.15K

Price to Earnings (P/E)13.7

Beta (1Y)0.19

Revenue Growth-16.36%

EPS Growth10.97%

CountryUS

Employees3,971

SectorUtilities

Sector Strength91

IndustryRegulated Gas

Share Statistics

EPS (TTM)N/A

Shares Outstanding1,680,429,000

10 Day Avg. Volume0

30 Day Avg. Volume2,152

Financial Highlights & Ratios

PEG Ratio0.45

Price to Book (P/B)1.95

Price to Sales (P/S)0.00

P/FCF Ratio-18.64

Enterprise Value/Market CapN/A

Enterprise Value/RevenueN/A

Enterprise Value/Gross ProfitN/A

Enterprise Value/EbitdaN/A

Forecast

1Y Price TargetN/A

Price Target UpsideN/A

Rating ConsensusN/A

Number of Analyst Covering0

Snam SpA Business Overview & Revenue Model

Company DescriptionSnam S.p.A., together with its subsidiaries, engages in the operation of natural gas transport and storage infrastructure in Italy. The company operates through Natural Gas Transportation, Liquefied Natural Gas (LNG) Regasification, and Natural Gas Storage segments. It provides natural gas transportation and dispatching services with approximately 32,700 kilometers of high-and medium-pressure gas pipelines; and owns and manages LNG regasification plants. The company also offers natural gas storage services through an integrated group of infrastructure comprising deposits, wells, gas treatment and compression plants, and the operational dispatching systems; and operates nine storage concessions, including five in Lombardy, three in Emilia-Romagna, and one in Abruzzo. In addition, it engages in the lease and maintenance of fibre optic telecommunications cables, as well as provides integrated services in the natural gas mobility sector; energy efficiency solutions for residential, industrial, tertiary, and public administration sectors; and management of biogas and biomethane plants. Further, the company offers engineering and project management services; and supervision of infrastructure planning activities. It also operates in Albania, Saudi Arabia, Austria, China, Egypt, the United Arab Emirates, France, Greece, the United Kingdom, and the United States. The company was formerly known as Snam Rete Gas S.p.A. and changed its name to Snam S.p.A. in January 2012. Snam S.p.A. was founded in 1941 and is headquartered in San Donato Milanese, Italy.

How the Company Makes MoneySnam SpA generates revenue primarily through its regulated businesses, including the transportation and dispatching of natural gas via its extensive pipeline network. It earns money by charging tariffs for the use of its infrastructure, which are set by regulatory authorities and provide a stable and predictable income stream. Additionally, Snam derives income from its storage services, earning fees from customers who store natural gas in its facilities. The company also engages in regasification activities, converting liquefied natural gas (LNG) back to gas for distribution, which adds another revenue stream. Furthermore, Snam has strategic partnerships and joint ventures that enhance its capabilities and market reach, contributing to its overall earnings. The company's focus on innovation and sustainability initiatives, such as investing in hydrogen and renewable energy projects, is also positioning it to capture new revenue opportunities in the evolving energy landscape.

Snam SpA Financial Statement Overview

Summary

Snam SpA shows strong revenue and profit growth with high profitability margins, although it faces challenges with high debt levels and negative cash flow trends. While positioned well within the regulated utilities sector, cash flow issues need addressing to ensure long-term stability.

Income Statement

Very Positive

Snam SpA has shown a strong financial performance with significant revenue and profit growth. The gross profit margin stands at 66.96% and net profit margin at 26.48% in 2023, indicating efficient cost management and profitability. The revenue growth rate from 2022 to 2023 was 22.62%, reflecting robust demand and operational strength. EBIT margin is notably high at 61.04%, showcasing effective operational efficiency.

Balance Sheet

Positive

The company maintains a stable balance sheet with a debt-to-equity ratio of 2.18, suggesting a high reliance on debt financing, which is typical for the utility sector. The equity ratio is 22.77%, indicating a moderate level of equity financing. Return on equity is strong at 14.87%, demonstrating effective use of shareholders' funds.

Cash Flow

Neutral

Cash flow performance presents challenges, with negative free cash flow growth and a declining operating cash flow. The operating cash flow to net income ratio is negative, highlighting potential issues in converting earnings to cash. Despite these concerns, the company has managed financing activities to sustain operations.

TTM	Dec 2023	Dec 2022	Dec 2021	Dec 2020	Dec 2019
Breakdown
Income Statement		Total Revenue
4.25B	4.29B	3.50B	3.29B	2.75B	2.63B
	Gross Profit
3.02B	2.87B	1.87B	1.78B	1.70B	1.68B
	EBIT
3.56B	2.62B	1.34B	1.41B	1.37B	1.45B
	EBITDA
3.00B	2.42B	2.07B	2.22B	2.13B	2.18B
	Net Income Common Stockholders
1.07B	1.14B	671.00M	1.50B	1.10B	1.09B
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
1.38B	1.38B	1.76B	1.34B	3.04B	2.85B
	Total Assets
33.61B	33.52B	32.47B	27.36B	26.13B	24.48B
	Total Debt
16.65B	16.65B	13.68B	15.36B	15.94B	14.77B
	Net Debt
15.27B	15.27B	11.92B	14.02B	12.89B	11.92B
	Total Liabilities
25.93B	25.84B	24.95B	20.12B	19.66B	18.23B
	Stockholders Equity
7.63B	7.63B	7.47B	7.20B	6.47B	6.25B
Cash Flow		Free Cash Flow
-515.00M	-1.68B	2.79B	94.00M	431.00M	532.00M
	Operating Cash Flow
1.22B	-135.00M	4.11B	1.34B	1.60B	1.49B
	Investing Cash Flow
-1.80B	-2.23B	-1.36B	-1.64B	-1.64B	-1.00B
	Financing Cash Flow
1.99B	1.99B	-2.32B	-1.41B	233.00M	494.00M

Snam SpA Technical Analysis

Technical Analysis Sentiment

Neutral

Last Price11.14

Price Trends

50DMA

10.59

Positive

100DMA

9.84

Positive

200DMA

9.67

Positive

Market Momentum

MACD

0.23

Positive

RSI

52.41

Neutral

STOCH

25.95

Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For SNMRY, the sentiment is Neutral. The current price of 11.14 is below the 20-day moving average (MA) of 11.30, above the 50-day MA of 10.59, and above the 200-day MA of 9.67, indicating a neutral trend. The MACD of 0.23 indicates Positive momentum. The RSI at 52.41 is Neutral, neither overbought nor oversold. The STOCH value of 25.95 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for SNMRY.

Snam SpA Peers Comparison

Overall Rating

UnderperformOutperform

Sector (63)

Financial Indicators

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
SNMRY	77 Outperform	$18.61B	13.68	16.36%	3.18%	-16.36%	10.97%
UGI	76 Outperform	$7.39B	14.20	10.84%	4.35%	-4.30%	―
ATO	76 Outperform	$24.66B	21.67	9.18%	2.16%	10.60%	8.55%
NJR	71 Outperform	$4.65B	11.22	17.83%	3.82%	20.30%	63.69%
NI	71 Outperform	$18.04B	20.65	10.34%	2.84%	13.08%	17.47%
SWX	65 Neutral	$5.01B	22.38	6.49%	3.55%	-10.78%	16.27%
Sector *	63 Neutral	$8.42B	10.38	5.35%	4.36%	3.59%	-11.58%

* Utilities Sector Average

Performance Comparison

SNMRY

Snam SpA

11.14

1.91

20.69%

ATO

Atmos Energy

153.66

39.30

34.37%

NJR

New Jersey Resources

46.18

3.85

9.10%

Nisource

37.82

9.82

35.07%

SWX

Southwest Gas

68.10

-4.29

-5.93%

UGI

34.65

11.29

48.33%

Snam SpA Earnings Call Summary

Earnings Call Date:May 08, 2025

(Q1-2025)

% Change Since: -3.21%|

Next Earnings Date:Jul 30, 2025

Earnings Call Sentiment Positive

The earnings call presented robust financial performance with strong EBITDA and net income growth, strategic acquisitions, and regulatory updates providing future visibility. However, there are concerns about decreasing investments and potential pressure on gas prices due to geopolitical factors.

Q1-2025 Updates

Positive Updates

Strong Financial Results

Adjusted EBITDA of EUR761 million, up 8.3% year-on-year, and adjusted net income at EUR406 million, up 21.2% year-on-year.

Strategic M&A Activities

Acquisition of Edison Stoccaggio completed, and sale of stake in ADNOC gas pipelines for EUR234 million, resulting in a capital gain of EUR120 million net of taxes.

Regulatory Updates

Weighted average cost of capital formula updated, providing future visibility. Resolution 130 changed RAB indexation, creating a one-off EUR52 million effect related to 2024 recovery.

Expansion in European Market

Acquisition of 24.99% stake in Vier Gas Holding, marking entry into German energy infrastructure space and strengthening presence in Europe.

Sustainability Initiatives

28% of CapEx aligns with EU taxonomy, and 52% with SDGs. New sustainable finance framework launched with ambitious carbon neutrality and net zero goals.

Negative Updates

Decreased Investments

Investments at EUR361 million, down 22% versus first quarter 2024, following completion of projects like Ravenna LNG terminal.

Pressure on Gas Prices

Potential Russian gas phase-out could put pressure on gas prices, coupled with oil price uncertainties.

Company Guidance

During Snam's Q1 2025 earnings call, the company reported a robust financial performance, despite challenging market conditions. Key metrics included an adjusted EBITDA of EUR 761 million, marking an 8.3% year-on-year increase, and an adjusted net income of EUR 406 million, up by 21.2% year-on-year. Investments amounted to EUR 361 million, a 22% decrease compared to Q1 2024, primarily due to the completion of the Ravenna LNG terminal. Net debt stood at EUR 16.8 billion, with a stable average cost of debt at 2.5%. The company highlighted significant M&A activities, including the acquisition of Edison Stoccaggio and a stake in Vier Gas Holding, and also noted a EUR 52 million one-off revenue effect from regulatory adjustments. Snam's strategic initiatives in gas infrastructure and energy transition were emphasized, alongside its commitment to sustainability, with 28% of CapEx aligned with EU taxonomy and a strong ESG investor base. The presentation concluded with the reaffirmation of financial guidance and ongoing regulatory developments.

Glossary

OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.

NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.

UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.

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.