E.ON underperforms energy sectorfor years, investors hardly benifit from dividends

E.ON underperformed sector for years

The stock was the past 10 year with a huge profit of 78 percent one of the best stocks in the energy sector. Over the past 10 year the average stock in the energy sector had a profit of 3 percent. Other strong performing stocks of the sector are Trecora Resources, Waste Connections Inc and Enersys Inc.

Historiscal prices E.ON past 10 years

The stock delivered over the past 12 months a loss of 21 percent. The energy sector delivered in the same period a profit of 13 percent. On a 5-years basis the stock underperformed her sector with a loss of 43 percent.Over the past 12 months the average German stock has a profit of 5 percent.

2015 best year, 2009 worst year

The matrix above shows E.ON 's historical returns expressed in the different entry years in the left axis.

The year 2009 was with a price loss of 41 percent the worst year (since 2008). The year 2015 is till now with a gain of 6 percent the best year for the stock. Who bought the stock in 2008 (price at that time 48,53 euros) has now a loss of 82 percent.

The stock E.ON is being covered by 24 fundamental analysts. The average target price for the stock is at 9,71 euros. This is around 11 percent more than the current stock price of 8,74 euros.

Quite high dividend E.ON

The average of the dividends estimates is at 0,38 cents. Consequently E.ON 's dividend return equals 4,35 percent. The average dividend of the energy sector equals 4,38 percent.

Historical dividends and dividend returns E.ON

The graph above shows the different returns since 2008. The green line is the total return of the reinvested dividends, the blue line is the price return and the red part is the total return: price returns plus dividend returns.

Dividend payments big support

Because of the price losses of the past years the dividend payments are only a rather small benefit for the investors. The buy & hold investor who bought the stock in 2008 now has a loss of 82 percent.

Last year's dividends were with 4,5 percent per year rather substantial. The total dividend return since 2008 is a significant 42 percent extra return for the investors. The influence of the reinvested dividends on the total return is for the buy & hold investor quite significant.

Analysts expect revenue decrease

For the current book year the analysts expect a total revenue of 110,34 billion euros. This is slightly lower than the revenue over 2015 of 116,22 billion euros.

Historical revenues and results E.ON plus taxations 2016

The analysts foresee for 2016 a net profit of 1,49 billion euros. For this year the analyst's consensus of E.ON 's result per share is a profit of 79 cents. Based on this the price/earnings-ratio equals 11,06.

Core figures energy sector

E.ON 's book to market ratio equals around 0,97. The energy sector currently trades with a CAPE of 5.06. Based on the number of outstanding shares E.ON 's market capitalization equals 17,06 billion euros.

The stock traded at 13.36 0,31 percent higher at 8,74 euros.

This equals 8 times the 2015's earnings per share.

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