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Terna
(OTC:TEZNY)
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Rating:62Neutral
Price Target:
$37.00
â–²(9.34% Upside)
Action:Reiterated
Date:07/30/26
The score is primarily held back by weak cash-flow conversion and recurring negative free cash flow despite strong profitability, which can sustain reliance on external funding. Offsetting this, the earnings call was constructive (guidance reaffirmed, improved margins, solid cash generation and financing execution) and valuation is reasonable with an attractive dividend yield. Technicals are mixed, with near-term weakness versus shorter moving averages but a still-positive longer-term trend.
Positive Factors
Regulated revenue growth and profitability
Terna's regulated transmission model provides recurring revenue visibility, while strong growth and improved EBITDA margins indicate effective execution. This supports durable earnings power as grid investment and system-operation needs expand.
Negative Factors
Persistent negative free cash flow
Heavy capital spending and other cash demands are not consistently covered by operating inflows, weakening cash conversion. Continued negative free cash flow may require external funding and can constrain financial flexibility during the investment cycle.
Read all positive and negative factors
Positive Factors
Negative Factors
Regulated revenue growth and profitability
Terna's regulated transmission model provides recurring revenue visibility, while strong growth and improved EBITDA margins indicate effective execution. This supports durable earnings power as grid investment and system-operation needs expand.
Read all positive factors
Terna (TEZNY) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$22.02B
Dividend Yield4.12%
Average Volume (3M)7.20K
Price to Earnings (P/E)17.2
Beta (1Y)-0.04
Revenue Growth19.35%
EPS Growth8.24%
CountryUS
Employees7,117
SectorUtilities
Sector Strength65
IndustryRegulated Electric
Share Statistics
EPS (TTM)1.68
Shares Outstanding669,997,300
10 Day Avg. Volume12,151
30 Day Avg. Volume7,200
Financial Highlights & Ratios
PEG Ratio0.00
Price to Book (P/B)2.24
Price to Sales (P/S)4.58
P/FCF Ratio-57.05
Enterprise Value/Market Cap<0.01
Enterprise Value/Revenue<0.01
Enterprise Value/Gross Profit<0.01
Enterprise Value/Ebitda<0.01
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 Description
Terna - Rete Elettrica Nazionale Società per Azioni, an Italian entity headquartered in Rome since its establishment in 1999, plays a pivotal role in electricity transmission and dispatching. Its operations extend across Italy, other Euro-area nat...
How the Company Makes Money
Terna primarily makes money through regulated electricity transmission and system operation activities. Its largest revenue stream comes from tariffs and regulated returns associated with (1) operating and maintaining the national high-voltage tra...
Terna Earnings Call Summary
Earnings Call Date:Jul 29, 2026
(Q2-2026)
| % Change Since: |
Next Earnings Date:Nov 12, 2026
Earnings Call Sentiment Positive
The call presented a largely positive operational and financial performance: double‑digit group revenue growth, strong nonregulated expansion, improved EBITDA margin, accelerated CapEx execution with key project milestones, solid cash generation and successful sustainable financing transactions. Notable negatives include a sharp rise in operating costs (+21%), only modest net income growth (+1% reported), higher finance costs and taxes, and regulatory/WACC uncertainty and procurement risks that could pressure future returns. On balance, the positive execution, funding achievements and growth drivers outweigh the challenges, though management will need to manage cost inflation and regulatory risk going forward.Positive Updates
Group Revenue Growth
Group revenues reached EUR 2.1 billion in H1 2026, up ~12% year‑on‑year (≈ +EUR 219 million). Net of a EUR 17 million one‑off in H1 2025 related to inflation revaluation, H1 2026 revenue growth would be ~13%.
Negative Updates
Operating Cost Increase
Total operating costs rose to EUR 647 million, up 21% YoY (~+EUR 112 million). Increase driven by higher headcount and external services in regulated activities and perimeter/volume expansion in nonregulated activities.
Read all updates
Q2-2026 Updates
Positive
Negative
Group Revenue Growth
Group revenues reached EUR 2.1 billion in H1 2026, up ~12% year‑on‑year (≈ +EUR 219 million). Net of a EUR 17 million one‑off in H1 2025 related to inflation revaluation, H1 2026 revenue growth would be ~13%.
Read all positive updates
Company Guidance
Management fully confirmed 2026 guidance, citing strong H1 execution and high visibility: group revenues €2.1bn (+12%), EBITDA €1.5bn (+8%) with a 24% margin (vs 20% a year ago), EBIT €961m (+5%) and net income €591m (+1%); cash flow generation ~€1.7bn and net debt €12.6bn (≈€0.5bn below 2025 year-end) with ~72% of gross debt at fixed rate and average maturity ~6 years; H1 CapEx €1.6bn (+20%) including ~€1.5bn in regulated activities (≈60% development, ~30% asset renewal/efficiency, defense ~€172m) and nonregulated/other ~€116m; project execution visibility high (≈92% of 2024–28 projects covered by contracts awarded, ≈93% authorized); OBIs expected around €200m for 2026 (H1 recognized ~€76m: €43m interzonal, €33m MSD); and strengthened funding (€850m European Green Hybrid Bond with >€7bn orders and subordination premium <60bps, €100m ESG-linked facility, EMTN program increased to €6bn) underpin management’s confidence in meeting the full‑year targets.Terna Financial Statement Overview
Summary
Income Statement
78
Positive
Balance Sheet
62
Positive
Cash Flow
41
Neutral
| Breakdown | TTM | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 4.27B | 3.79B | 3.65B | 3.15B | 2.92B | 2.57B |
| Gross Profit | 1.91B | 1.82B | 3.34B | 2.58B | 2.42B | 2.16B |
| EBITDA | 2.86B | 2.56B | 2.57B | 2.11B | 2.04B | 1.83B |
| Net Income | 1.12B | 1.07B | 1.06B | 885.40M | 857.00M | 789.40M |
Balance Sheet | ||||||
| Total Assets | 30.55B | 35.24B | 27.19B | 23.47B | 22.83B | 22.39B |
| Cash, Cash Equivalents and Short-Term Investments | 2.27B | 3.01B | 2.76B | 1.74B | 2.41B | 2.55B |
| Total Debt | 14.86B | 11.67B | 13.86B | 12.98B | 10.81B | 12.42B |
| Total Liabilities | 21.86B | 28.15B | 19.64B | 17.10B | 16.63B | 17.60B |
| Stockholders Equity | 8.63B | 7.77B | 7.52B | 6.32B | 5.15B | 4.68B |
Cash Flow | ||||||
| Free Cash Flow | -211.76M | -304.97M | -1.16B | -963.90M | 831.40M | -511.90M |
| Operating Cash Flow | 3.01B | 2.52B | 1.47B | 1.08B | 2.32B | 832.30M |
| Investing Cash Flow | -3.46B | -3.68B | -2.40B | -2.33B | -1.86B | -863.30M |
| Financing Cash Flow | 11.41M | 700.80M | 1.87B | 464.30M | 92.50M | -1.05B |
Terna Technical Analysis
Negative
33.84
Price Trends
34.57
Negative
34.55
Negative
33.51
Negative
Market Momentum
-0.37
Positive
30.37
Neutral
0.06
Positive
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TEZNY, the sentiment is Negative. The current price of 33.84 is below the 20-day moving average (MA) of 33.98, below the 50-day MA of 34.57, and above the 200-day MA of 33.51, indicating a bearish trend. The MACD of -0.37 indicates Positive momentum. The RSI at 30.37 is Neutral, neither overbought nor oversold. The STOCH value of 0.06 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for TEZNY.
Terna Peers Comparison
UnderperformOutperform
Sector (66)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
66 Neutral | $67.78B | 21.39 | 10.01% | 3.05% | 8.63% | -14.89% | |
66 Neutral | $17.65B | 18.10 | 5.60% | 3.62% | 6.62% | 11.55% | |
64 Neutral | $45.05B | 15.93 | 9.61% | 3.80% | 6.56% | 3.72% | |
62 Neutral | $22.02B | 17.16 | 13.60% | 4.12% | 19.35% | 8.24% | |
62 Neutral | $15.36B | 2.63 | 16.03% | 4.37% | -1.36% | 22.18% | |
62 Neutral | $26.42B | 27.23 | 8.53% | 3.18% | 6.73% | 26.95% | |
61 Neutral | $78.18B | 17.44 | 8.47% | 4.15% | 1.13% | 13.83% |
* Utilities Sector Average
TEZNY
Terna
32.90
3.72
12.75%
AEP
American Electric Power
124.50
20.19
19.35%
EXC
Exelon
43.64
2.14
5.17%
KEP
Korea Electric Power
11.94
-1.70
-12.46%
NGG
National Grid Transco
78.12
10.44
15.43%
PPL
PPL
35.11
0.56
1.61%
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.