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Friday, July 12, 2024

Abu Dhabi National Energy Company PJSC’s (ADX:TAQA) Three-Year Total Shareholder Return Exceeds Underlying Earnings Growth


The worst thing you can do after buying stock in a company (assuming no leverage) is that you lose all the money you invested.But if you buy stock in a really great company, you can more Twice as much as your money.For example Abu Dhabi National Energy Company PJSC (ADX: fall) shares are up 290% from three years ago. Most people will be happy with that. It’s also up 13% in about a month.

While the stock is down 4.8% for the week, it’s worth looking at the long-term outlook to see if the stock’s historical returns have been driven by fundamentals.

Check out our latest analysis for Abu Dhabi National Energy Corporation PJSC

SWOT Analysis of Abu Dhabi National Energy Company PJSC


  • Profit growth has outpaced the industry in the past year.
  • Debt is well covered by income and cash flow.

  • Low dividend compared to the top 25% of dividend payers in the consolidated utilities market.

  • Good value based on P/E ratio compared to estimated fair P/E ratio.

  • TAQA sees no apparent threat.

While some continue to preach the efficient market hypothesis, it turns out that markets are dynamic systems that overreact and investors are not always rational. One way to examine how market sentiment changes over time is to look at the interaction between a company’s stock price and its earnings per share (EPS).

Abu Dhabi’s national energy company, PJSC, has seen its earnings per share grow at an annual rate of 59% for three years, pushing up the share price. This EPS growth rate is very close to the stock price’s average annual growth rate of 57%. This suggests that market sentiment for the company hasn’t changed much over the period. on the contrarystock price changes can be said to mimic the growth of earnings per share.

Below you can see how EPS has changed over time (click on the image to discover the exact value).

ADX: TAQA EPS growth July 4, 2023

We know that PJSC, Abu Dhabi’s national energy company, has improved its profitability over the past three years, but what about the future? Here you can see how its balance sheet has strengthened (or weakened) over time free interactive graphics.

What about dividends?

When considering return on investment, it is important to consider the difference between total shareholder return (TSR) and stock price return. Based on the assumption of dividend reinvestment, the total shareholder return includes the value of any spin-off or discounted financing as well as any dividends. It’s fair to say that total shareholder return more fully describes dividend-paying stocks. We note that Abu Dhabi National Energy Company PJSC’s total shareholder return of 320% over the past 3 years is better than the above share price return. There is no doubt that dividend payments largely explain this difference!

Different perspectives

Happily, Abu Dhabi’s national energy company, PJSC, delivered a total shareholder return of 181% last year. This includes the value of dividends. This gain actually exceeds the total shareholder return of 61% generated over three years (annually). The improved shareholder returns show that the stock has become more popular over time. It’s always interesting to track long-term share price performance. But to understand Abu Dhabi National Energy Corporation PJSC better, we need to consider many other factors.Even so, please note Abu Dhabi National Energy Company PJSC is demonstrating 3 warning signs in our investment analysis 1 of which is a bit worrisome…

certainly Abu Dhabi national energy company PJSC might not be the best stock.So you might want to check this out free A collection of growth stocks.

Note that market returns quoted in this article reflect the market-weighted average return of stocks currently traded on the Emirian Exchange.

Valuation is complicated, but we’re helping make it simple.

Find out if Abu Dhabi National Energy Company PJSC’s valuation may be overvalued or undervalued by viewing our comprehensive analysis, which includes Fair value estimates, risks and caveats, dividends, insider trading and financial health.

View free analysis

This Simply Wall St article is general in nature. We use an unbiased approach only to provide reviews based on historical data and analyst forecasts, and our articles are not intended to provide financial advice. It does not constitute a recommendation to buy or sell any stock and does not take into account your objectives or your financial situation. Our goal is to provide you with long-term focused analysis driven by fundamental data. Note that our analysis may not take into account the latest price-sensitive company announcements or qualitative material. Simply Wall St does not hold a position in any of the stocks mentioned above.


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