total return on stock
compared to original
listing in 2003
million euro
added value distributed
to local stakeholders

The commitment to reduce the investment risk

Hera pays great attention to the monitoring of the risk components associated with the trend of the stock on the stock market, such as the volatility of the listed prices and the liquidity of the market trading.

Once again in 2018, the stock disclosed a volatility index of the listed prices (Beta index) more conservative than the average of the shares in the sector. This characteristic is consistent with the strong resilience of the economic results, the low risk profile and the soundness of the governance.

The daily average volumes in 2018 came to 2.1 million shares traded (-5.4% compared with 2017), while the average equivalent value of the daily trading came to Euro 5.9 million (-2.0% compared with 2017). The average volumes traded were better with respect to that reported by the peers who by contrast disclosed a more pronounced decrease of -7.8%.

The greater liquidity of the daily trading with respect to the peers made it possible to draw the values of the sales orders closer to those of the purchase orders, revealing a lower spread (0.27%) with respect to the average of the other securities in the sector (0.28%). A more consistent comparison with the securities not included in the FTSE MIB index (such as for example Acea and Iren) discloses an even more favourable condition (0.27% with respect to 0.31%).

The liquidity of the stock market trading is also the result of intense dialogue with the financial market operators, with around 316 contacts and meetings in 2018, and the launch of new relations with professional investors which have an investment style consistent with the share profile of the Group.

The diversification of the institutional investors between the shareholders of the company is also an important factor for facilitating an on-going evolution of the shareholding structure and a balance of the listed prices of the stock over time. As the following diagrams show, Hera presents a balanced geographic and investment style diversification of the professional investors, benefiting the resilience and low volatility of the stock.

In the diagram on the right, the item Other contains: equity hedges, hedge funds, momentum specialty, yields. “Growth” investors are understood to be investors which select the securities on the basis of the expected growth rates; “Value” investors select the securities on the basis of the fundamentals; “Index” investors select the securities replicating the indexes or using algorithms.
Source: Thomson Reuters

The growth in the Value investors with respect to the previous year, reflects the solid fundamentals expressed by the Group at the time of the presentation of the quarterly results which were not fully reflected in the listing of the stock, as moreover highlighted by the increase in the gap (potentially rising) between the target price of the analysts and the price of the stock.

The Hera stock is included in the FTSE Mid Cap, FTSE All Share and FTSE Italia Servizi Pubblici of Borsa Italiana share indexes. During 2018, the stock was constantly included – in the four quarterly reviews – within the reserve list for inclusion in the FTSE Mib index, the basket which contains the leading forty companies in the country in terms of free float and liquidity of the trading.

Hera Stock simultaneously belongs to six ethical indexes: FTSE Environmental Opportunities All Share Index, TR top 100 global energy leader, CDP Climate, CDP Water, United Nations Global Compact 100, Thomson Reuters Diversity and Inclusion Index. The ethical indexes include securities of excellent companies from the standpoint of business sustainability in order to facilitate the investment choices of socially responsible funds (Sri). The organisation of these indexes considers that the companies with sustainable management, from an environmental standpoint, as well as with regard to the dealings with the stakeholders and the corporate governance, obtain significantly higher results than their competitors over the long-term.

Furthermore, the Bloomberg analysts have valued the Group’s policies and strategies with regard to inclusion and have assigned a score of 77.85 points out of 100 to the same. The Group score was 4.61 points higher than the average of the companies included in the index and exceeded that obtained by the multi-utility companies in the basket by 3 points.

Hera stock joins the FTSE Mib index

Borsa Italiana has officialised the entry of Hera stock in the FTSE Mib index, the stock market index of the 40 leading companies in terms of capitalisation and liquidity. Hera has been able to achieve this prestigious goal, thanks to both the achievement of 27th position in the ranking of the capitalisations of the Italian companies and to the increase in the equivalent value of the trading (+52% in the first two months of 2019 compared with the average in 2018), further to the presentation of the new business plan.