Endesa vs Iberdrola Which Is More Favorable?

Endesa and Iberdrola are two major players in the Spanish energy sector, with both companies listed on the stock exchange. Endesa, the largest electric utility company in Spain, has a significant presence in Europe and Latin America. On the other hand, Iberdrola is known for its focus on renewable energy and its international expansion. Investors looking to invest in the energy sector in Spain may consider comparing the stocks of these two companies to make informed investment decisions.

Endesa or Iberdrola?

When comparing Endesa and Iberdrola, different investors may prioritize various metrics based on their investment strategies and goals. So, ask yourself what type of investor you are. This will guide you in determining which metrics are most important for your investment decision between Endesa and Iberdrola.

Dividend Investors:

Dividend investors look for stable and growing income streams, using dividend metrics to assess potential investments. A company's dividend yield essentially measures the size of its dividend relative to the total market value of the company. Endesa has a dividend yield of 5.93%, while Iberdrola has a dividend yield of 4.17%. Beyond the yield itself, considering the growth and sustainability of these dividends is also crucial. Endesa reports a 5-year dividend growth of 6.13% year and a payout ratio of 332.88%. On the other hand, Iberdrola reports a 5-year dividend growth of 8.97% year and a payout ratio of 6.92%.

Value Investors:

Value investors focus on financial metrics to determine a stock's intrinsic value compared to its market value. The Price-to-Earnings (P/E) Ratio links stock price to a company's earnings per share, with Endesa P/E ratio at 15.77 and Iberdrola's P/E ratio at 12.47. Another crucial valuation metric is the Price-to-Book (P/B) Ratio, which compares stock price with book value per share. Endesa P/B ratio is 1.38 while Iberdrola's P/B ratio is 1.55.

Growth Investors:

Growth investors prioritize metrics indicative of a company's expansion potential. Focusing on top-line growth, Endesa has seen a 5-year revenue growth of 1.56%, while Iberdrola's is 0.47%. Return on Equity (ROE) measures how effectively a company uses equity investment to generate earnings, with Endesa's ROE at 8.97% and Iberdrola's ROE at 13.51%.

Retail Investors:

Retail investors often consider stock affordability and company familiarity. For example, day low prices are $10.30 for Endesa and €13.23 for Iberdrola. Over the past year, Endesa's prices ranged from $8.54 to $11.11, with a yearly change of 29.96%. Iberdrola's prices fluctuated between €10.42 and €14.23, with a yearly change of 36.61%. Brand recognition also plays a role, as familiarity with a company can influence investment decisions.