ENI

Analysis of ENI share price

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The energy sector is one of the most popular sectors at the moment and attracts many traders who buy and sell shares of the major groups in this field of activity online. One of the most widely traded European stocks at the moment is that of the Italian group ENI, which we are going to present here in detail, explaining the breakdown of its activity, but also giving you some practical advice that will enable you to make a concrete analysis of its share price.  

Elements that can influence the price of this asset:

Analysis N°1

In particular, we know that the ENI group is currently trying to position itself on the LNG or Liquefied Natural Gas market, which can quickly become a source of growth for the company. Indeed, liquefied natural gas is one of the types of energy that are currently on the rise and is considered more valuable than some other energy products.

Analysis N°2

The ENI Group has a very significant cash flow, which will undoubtedly enable it to invest in the coming years in new resources for the future, as it is currently doing with liquefied natural gas, especially as its profits are also relatively stable.

Analysis N°3

ENI has also recently put a lot of emphasis on energy production from recycled products. However, given the current ecological context and its major global challenges, it is highly likely that these investments will soon bear fruit.

Analysis N°4

The group should be increasingly exposed to political threats which could thus have a negative influence on the costs of producing ENIs.

Analysis N°5

Still with regard to the future brakes on the growth of ENI's activities, we would like to stress once again the strong competition in its sector of activity, energy, which has some real mastodons likely to come and take over some of its market shares.

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Trade the ENI share!
76.4% of retail investor accounts lose money when trading CFDs with this provider.

General presentation of ENI :

The ENI group or Ente Nazionale Idrocarburi is one of the leaders in the oil and gas sector on the European scene. Its activity covers various fields, mainly oil refining and distribution, but also the purchase and sale of natural gas and the production of electricity, hydrocarbon exploration and production, energy services and petrochemicals.

ENI achieves most of its turnover in Europe, particularly in Italy, but also works with Asia, Africa and the rest of the world.

The ENI Group's shares are listed on the NYSE market of the Netherlands and include the calculation of the EuroStoxx 50 stock market index. Its share price has experienced highs and lows as shown in the technical analysis, and it is therefore essential to follow the charts closely in the months and years to come.

 

To know the competition of the ENI action :

The Italian group ENI is present on two types of market, namely the oil market and the gas and electricity supply market. As such, it competes both with the major oil groups and with other energy supply companies in Italy and Europe. It is essential to also take into account the share of the turnover concerned by each activity of the ENI group in order to best anticipate the impact of competition news. In order to correctly analyse its share on the stock market, it is therefore essential to know the company's main competitors in these two sectors, in order to compare their results and use their news to your advantage.

 

The strategic alliances set up by the ENI Group :

Here are the main current partnerships set up by the ENI Group that you should be aware of.

 

The advantages and strengths of the ENI share as a stock market asset :

If you plan to trade ENI's share price through CFDs, you should of course not rely solely on your intuition to take an online position. An effective strategy is based on a comprehensive understanding of a company's ability to gain and maintain investor confidence over the long term. To be able to anticipate the underlying trends of an asset such as ENI shares, it is therefore necessary first and foremost to be familiar with the strengths and weaknesses of this major energy group. To help you do this, we have chosen to list the strengths and weaknesses of this value here. Let's start, of course, with the advantages that this company has and that could support its future growth.

One of the ENI group's greatest assets is, of course, its very appreciable positioning on the world energy market. Indeed, the European group has succeeded in making its mark among the giants of this sector and is today, thanks to the quality and diversity of its services, one of the best known companies in this sector throughout the world.

Another major asset of the ENI Group is the way it manages the energy supply chain. In fact, in addition to being one of the world's largest oil and natural gas production companies, ENI is involved in the entire energy supply chain, from extraction to distribution, including refining and marketing. As a result, it depends on few subcontractors and intermediaries and can manage its distribution and marketing strategies independently.

But to achieve this positioning among the leaders of its market, the ENI group can rely on various assets. First of all, it should be noted that this company is one of the oldest to carry out this activity in Europe, which gives it a certain amount of experience in the face of competitors who arrived later in the sector. On the other hand, ENI tends to remain at the top of the ranking thanks to the development over time of its research and development capacities. In this way, it is able to solve any problems and face the changes taking place in the consumer society with greater serenity.

 

Disadvantages and weak points of the ENI share as a stock market asset :

First of all, we are going to raise here an important point to be aware of regarding the financial aspect of this group. Indeed, ENI has been facing for some years now certain financial problems that have been pointed out by analysts and penalised by the market. This concerns in particular the repercussions of the recent European financial crisis, which have of course had a direct impact on ENI's activities and contributed to a decrease in its level of profitability.

Analysts specialising in this market also point the finger at the poor quality of the ENI group's administration which, despite numerous changes in recent years, still has difficulty in managing production costs and the strategy for selling its energies and associated services. Indeed, the objectives set by the management are only rarely achieved, which naturally weighs on the morale of investors.

Still with regard to the weaknesses of this company, the more than disappointing results of certain branches of the group are also to be regretted. This mainly concerns the petrochemicals division, which for some years has been performing below expectations despite its importance in the distribution of the group's activities. The weight of this recession is of course significant on the group's overall results.

While the ENI Group benefits from total management of its energy supply chain and the services it provides, this asset can also prove to be a disadvantage as it reduces the amount of relationships with other major energy players in the world. This results in less visibility in certain areas and greater difficulty in penetrating certain markets internationally.

Finally, one will also note the disappointment of investors when the ENI group abandons some of its development projects, as was the case in the 1960s with the abandonment of the construction of an oil factory in England. This type of unpleasantness could indeed happen again and result in immediate sanctions on the stock market.

Frequently Asked Questions

What are the risk factors for ENI action?

Major risk factors for the ENI share price include, of course, fluctuations in the price of crude oil and natural gas, increased global competition, environmental and safety risks, exploration and production risks, uncertainties over natural gas reserves, political, social and economic instability, risks related to demand from industry and exchange rate risks.

What were the latest acquisitions and disposals of ENI?

In 2018, ENI sold to Qatar Petroleum a 35% interest in Area 1 offshore Mexico. The same year, it sold ç Mubadala Petroleum a 20% stake in the Nour North Sinai Offshore concession in Egypt. In 2017, ENI and KPM bought out the transfer of the subsoil rights of the Isatay block with a 50% takeover of the subsoil rights in the Caspian Sea.

What will be the dividend paid by ENI in 2020?

The ENI Group has announced a 3.5% increase in its dividend to be paid in 2020 with a remuneration of €0.89 per share, in line with its commitment to a progressive remuneration policy and the continuation of the buyback programme with a capital allocation of €400 million in 2020. Of course, you can follow these data and their evolution directly from the official website of this company and in the 'investors' section of it.

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Trade the ENI share!
76.4% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work, and whether you can afford to take the high risk of losing your money.