Engie: 1H26 Preview - Guidance reiteration should reassure on overdone geopolitical concerns – Reiterate OW

Research evidence excerpt

Engie: 1H26 Preview - Guidance reiteration should reassure on overdone geopolitical concerns – Reiterate OW

Barclays | Engie

At the group level, we forecast 1H26 Net Recurring Income group share of €2,824m, net financial

debt of c.€57.1bn following completion of the UK Power Networks transaction, and 1H26

nuclear subdivision EBIT of €131m.

Overall, we expect investors to take comfort from limited evidence of Middle East-related

disruption, despite 2Q26 being more exposed to the conflict period than 1Q26. Our

forecast for 2Q26 EBIT excluding nuclear of €1,480m, above €1,372m in 2Q25, should

support confidence in underlying delivery, while the expected reiteration of 2026 financial

guidance would further reinforce the message.

We continue to see a compelling investment case and reiterate our Overweight rating. As

set out in our 18 June 2026 report, Engie - Still more to go – Quality improving / catalysts

building; reiterate OW / PT increased (again), we think further relative outperformance remains

achievable as the group’s earnings mix becomes higher quality and more visible. The UK Power

Networks acquisition materially increases exposure to regulated and long-term contracted

earnings, while also strengthening Engie’s positioning in electrification and data-centre-driven

grid growth. Despite c.13% outperformance versus the SX6P over the past year, Engie still trades

at an 8–16% discount to European integrated utility peers across key valuation metrics, which

we view as too wide given c.6% adjusted EPS growth from the 2026E trough, management’s 7%

EBIT excluding nuclear CAGR target and a 5–6% dividend yield. We also see positive earnings-

revision risk, with our 2026–28E forecasts modestly above consensus, supported by a strong