We have updated our model for GEK Terna, increasing our forecasts for the group’s adjusted EBITDA by about 5% and our target price (PT) to 55.0 euros per share, from 54.0 euros per share previously, Euroxx analysts write.
We remain positive on the stock, due to the strong growth in adjusted EBITDA from the existing concessions, the scope for further expansion into new projects and the large backlog in the construction sector. The valuation remains, in our view, attractive, with GEK Terna trading at 9.4x EV/adjusted EBITDA for 2028E.
We have updated our model for the listed company to include the recent share capital increase and the strong 2Q26 results. We now expect adjusted EBITDA from the construction sector to exceed 220 million euros annually in 2026 and 2027 (from about 190 million euros previously), leading to an increase of about 5% in our forecasts for the group’s adjusted EBITDA.
Overall, we expect the group’s adjusted EBITDA to exceed 700 million euros in 2026 and rise to about 900 million euros by 2029E, driven by a resilient concessions sector (accounting for >70% of adjusted EBITDA) and a high backlog of about 9 billion euros in the construction sector.
We raised our target price to 55.0 euros per share from 54.0 euros previously, due to our more positive assumptions for the construction sector, Euroxx continues. Our target price implies a fair EV/EBITDA of 5.7x for the construction sector in 2026, a blended EV/EBITDA of 7.5x for the Conventional Energy sector in 2026 and EV/EBITDA of about 11x for operating concessions in 2028.
The low degree of balance sheet leverage (the parent company’s net debt is close to zero) and cash reserves of 280 million euros (in the first half), on a non-project finance basis, provide significant room for further expansion into new concession projects in the near term.