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17.03.2021 10:44 AM
Review of EN+ GROUP INTERNATIONAL (ENPG) stocks

En+ Group International Public Joint-Stock Co is a global natural resource extraction company based in Russia. It operates in metal and energy segments. The metallurgy segment covers the vertically integrated production of aluminum, including the extraction and processing of bauxite into alumina, as well as the production and distribution of primary aluminum, alumina, and related products. The energy segment represents the operation of independent electricity generation in Russia. The company is engaged in all major areas of the electric power industry, such as electricity and heat generation, electricity and heat distribution, electricity transmission, electricity and heat sales, energy retail, as well as supply and engineering services. Hydropower is a key business area of the energy segment. In addition, the company has solar and combined heat and power plants. The company owns mines, production facilities, and projects under development around the world.

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En+ Group has an attractive multiplier, which may change from year to year. For each ruble invested, speculators get 0.94 rubles in the company's assets. ENPG's real value is almost three times higher than its capitalization. In 2020, the P/E ratio was 8.53. Yet, in 2021, due to the expected profit growth, the ratio was significantly reduced to 3.91. The dividend for 2020 was lower than expected, totaling 1.49%. However, by the end of 2021, analysts predict an increase in the dividend to the level of 6.07%.

The forecast for sales and profit growth of the company is positive. In 2021 it is expected to significantly boost the margin from 10.5% to 15.5%. Notably, the company's problem is its high debt burden. In 2020, Financial Leverage (Debt/EBITDA), debt to profit, came in at 5.08. In previous years the leverage decreased to 3.16 x. The asset utilization ratio ROA (Net Profit/Asset) for 2020 is also low, amounting to 2.47%.

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In the short term, the fundamental indicators of the En+ group are quite curious. The company has an attractive valuation level with a low EV/Sales multiplier ratio compared to its competitors. EN+ GROUP INTERNATIONAL is of great interest to investors looking for high-dividend stocks.

Over the past year, analysts studying stock markets have revised upwardly the company's income as well as earnings expectations. Analysts mainly recommend increasing the volume of shares in the portfolio or just give the green light for buying. However, the company also has significant drawbacks. According to forecasts, sluggish sales growth is expected in the coming financial years. One of the main weaknesses of the company is its financial situation. The prospects of analysts about the company's shares do not coincide. Such various estimates confirm the poor tracking of the group's activities. The company's earnings reports rarely meet investors' expectations.

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ENPG group shares are showing an upward trend. Last week, they broke the double trough and closed above it. Technical indicators signal an increase in quotes to the values of 840 and 950. One may buy from the current values with the targets up to 5% of the liquid capital. Investors should consider closing the position if the price drops below the 550 level. Be careful as the situation may chage. Follow the rules of money management.

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