Eni SpA’s Dividend Yield Ranks Third, Has the Highest Valuations


Jun. 27 2018, Updated 7:32 a.m. ET

Eni’s dividend yield

Eni SpA (E) is the third-highest stock on our list of the top eight dividend-yielding integrated energy stocks. The company’ market cap of $64 billion is the smallest among the eight companies we’re covering in this series.

Eni has a current dividend yield of 5.3%. In the first half of 2018, it paid a dividend of $0.94 per share. It has paid dividends throughout the oil price cycle in the past three years. However, its dividends have fallen. Three years ago, it made a dividend payment of $1.23 per share in the first half of 2015. Since then, its dividend has risen marginally. During the three-year period, Eni stock fell 1%, the first of our stocks so far to decline.

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Eni trades at a forward PE ratio of 13.6x, which is above the average ratio for our group. However, it trades below the forward enterprise-value-to-EBITDA of the peer average. The stock has had a mixed valuation trend.

Eni reels under a cash flow shortfall. Its cash flow from operations in the first quarter couldn’t cover its capex and dividend outflows, and it used cash reserves to meet the shortfall. Royal Dutch Shell (RDS.A) and ExxonMobil (XOM), on the other hand, saw surplus cash flows from operations, which covered their capex and dividend payments in the first quarter.

Eni’s robust upstream portfolio is expected to provide production growth. It’s also ramping up production at its mega Zohr gas field.

In the next part, we’ll see which company is next in terms of dividend yield.


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