On July 22, $IBE (-1,61 %) the results for the past quarter. According to the current analyst consensus on Investing.com, the following is currently expected:
- EPS: 0.23 EUR
- Revenue: 10.57 billion EUR
So, after a strong start to the year, the bar is certainly set high.
For me, however, other metrics play a decisive role when it comes to a utility company. Much more important than a slight beat in revenue or profit is the question of whether $IBE (-1,61 %) it can continue to confirm its long-term growth trajectory. That’s why I’ll be paying particular attention to operating cash flow, EBITDA, the trend in net debt, and the progress of the multi-billion investment program. After all, only if the company can finance its substantial investments through strong operating performance will the foundation for rising dividends remain intact. I find the network business particularly interesting in this regard. Regulated networks are increasingly becoming the most important revenue driver for $IBE (-1,61 %) and provide revenues that are significantly easier to plan than those from the traditional generation business. At the same time, I will be watching how the growth markets in the U.S. and the U.K. develop, as a significant portion of the investments is expected to be made there in the coming years.
Management’s outlook will also be intriguing. Following the upward revision of the full-year forecast in the first quarter, the market is likely to listen closely to see whether $IBE (-1,61 %) it is confirmed or even becomes more optimistic once again.
The interest rate environment also remains an important factor. As a capital-intensive utility, $IBE (-1,61 %) from stable financing costs, as they facilitate the further expansion of the grid infrastructure and renewable energy.
I also do not expect any surprises regarding capital allocation. I do not anticipate either a new share buyback program or changes to the dividend policy. Rather, management is likely to continue focusing on investments, balance sheet quality, and sustainable dividend growth.
Analysts remain largely optimistic. Accordingly, it is likely to be less about whether revenue or EPS beats expectations and more about whether $IBE (-1,61 %) its long-term growth trajectory is confirmed. Historically, the stock has tended to react rather moderately to quarterly results. Management’s outlook has often been the decisive factor.
$IBE (-1,61 %) is currently still on my watchlist. Especially from a dividend investor’s perspective, I find the combination of a regulated grid business, investments in renewable energy, and a long-term rising dividend extremely exciting. The upcoming quarterly results will therefore be an important factor for me in deciding whether the company will find its way into my portfolio in the future.
