Enel Chile Is Fairly Valued, After A Record 2024 That Is Challenging To Repeat
Summary
- Enel Chile's 2024 results met expectations, driven by stable pricing, strong cash flows, and favorable hydrology, despite a $100 million storm-related settlement.
- The company reaffirmed its 2027 net income targets of $500–700 million, implying an 11–15% earnings yield on current market cap, maintaining a Buy rating.
- Hydrology reversion and reliance on cheaper Argentinian gas will impact future profitability, with increased capex in battery storage projects to offset hydro generation declines.
- An accounting change to USD functional currency affected Q4 earnings, but future FX impacts should be mitigated by continued hedging strategies.
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