ACEA (BIT:ACE) Reports Strong Half Year Earnings, Is It Still Below Fair Value?

ACEA (BIT:ACE) drew fresh attention on 23 July 2026 after reporting half-year results that included higher sales of €1,444.75m, revenue of €1,537.5m, and net income of €454.45m.

See our latest analysis for ACEA.

ACEA’s latest earnings news comes after a period where the share price has eased, with a 90 day share price return down 9.59% and year to date down 3.71%. At the same time, the 3 year total shareholder return stands at 138.97%, suggesting longer term holders have seen much stronger gains than recent buyers.

If the move in ACEA has you reviewing the wider utilities universe, it could be worth scanning for other listed infrastructure and grid operators using our power and grid technology stock ideas through the 36 power grid technology and infrastructure stocks

ACEA’s recent earnings and longer term returns point to a solid multi-utility business. After the share price pullback, the key question now is whether the current valuation still reflects that strength or has moved too far.

Most Popular Narrative: 18.3% Undervalued

ACEA's most followed valuation narrative sets a fair value of €26.08 per share, above the last close of €21.30. This frames the latest earnings move in a wider story about regulated infrastructure and long term returns.

The planned pivot to >95% of EBITDA from regulated infrastructural businesses, including the disposal of ACEA Energia, is expected to enhance earnings stability and long-term visibility, reducing exposure to margin volatility from competitive retail markets, supporting higher, more predictable net margins and cash flow.

Read the complete narrative.

Want to understand why this narrative still lands on an 8% plus revenue growth path while earnings are expected to shrink and the future P/E climbs sharply? The fair value hinges on how those moving parts fit together.

Based on this framework, the narrative uses an 8.642% discount rate and assumes ACEA can grow revenue while accepting thinner margins, then supports a higher valuation multiple on those future earnings. The end result is a fair value that sits well above the current share price and treats the stock as trading at a discount to that scenario.

Result: Fair Value of €26.08 (UNDERVALUED)

Have a read of the narrative in full and understand what's behind the forecasts.

However, the ACEA story still faces real pressure points, including higher leverage tied to heavy capex and the possibility of less favourable regulatory decisions on allowed returns.

Find out about the key risks to this ACEA narrative.

Another View on ACEA’s Valuation

The Simply Wall St DCF model paints a very different picture for ACEA. On this view, the current share price of €21.30 sits well above an estimated future cash flow value of €7.53, which frames the stock as expensive rather than undervalued. Which story do you think fits the cash flows best?

Look into how the SWS DCF model arrives at its fair value.

Simply Wall St performs a discounted cash flow (DCF) on every stock in the world every day (check out ACEA for example). We show the entire calculation in full. You can track the result in your watchlist or portfolio and be alerted when this changes, or use our stock screener to discover 242 high quality undervalued stocks. If you save a screener we even alert you when new companies match - so you never miss a potential opportunity.

Next Steps

With ACEA's mixed signals on valuation and earnings, it makes sense to check the underlying data yourself and decide where you stand. To balance the concerns and potential upside, review the 5 key rewards and 3 important warning signs.

Looking for more investment ideas beyond ACEA?

If ACEA has sharpened your focus, do not stop here. Use the Simply Wall St screener to spot other opportunities that could fit your approach just as well.

• Target potential mispricing by scanning 242 high quality undervalued stocks that combine solid fundamentals with prices that may not fully reflect their underlying strength.
• Strengthen your income stream by reviewing 440 dividend fortresses that aim to pair higher yields with more resilient payout histories.
• Dial down portfolio risk by examining 298 resilient stocks with low risk scores that score well on financial stability and volatility measures.

This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team@simplywallst.com