Investing.com - Barclays has reaffirmed its confidence in Iberdrola and has named the Spanish utility company among its top picks in the European utilities sector. In a report published on May 26, the British bank maintains its " Overweight " rating and raises its price target to €22.60 per share, implying upside potential of nearly 15% from current market levels.

In its report, the British bank rates Iberdrola as the “gold standard” among European utilities and ranks it among its top picks in the sector. Barclays argues that the Spanish power company offers one of the strongest combinations of growth and stability within the continent’s energy sector, supported by its exposure to regulated markets, renewables, and a diversified geographic presence in Spain, the United Kingdom, the United States, and Brazil.

Report Highlights

One of the central pillars of Barclays’ thesis is that 55% of the group’s value comes from its regulated grid business, which provides revenue recurrence and visibility that are hard to match in the sector. The bank projects earnings per share growth of around 11% annually between 2026 and 2030, slightly above the sector average, and estimates a 9% annual dividend increase through that same period.

“Many generalist investors view Iberdrola as one of the top choices for stable exposure to the European electricity sector,” the bank notes in its analysis, according to MarketScreener Spain.

Barclays also views the recent exit from Mexico positively, as it believes it aligns with the group’s focus on its four priority markets and frees up resources for investment opportunities with more predictable returns. Likewise, the bank highlights the continuity of the management model under the chairmanship of Ignacio Galán and the executive transition led by Pedro Azagra, whom it describes as part of a management team that is “capable and aligned” with the growth plan.

The bank acknowledges that Iberdrola has historically traded at a premium compared to European peers such as Engie or Enel, and believes that this difference is justified by the group’s defensive profile and the visibility of its cash flows.

What to watch

• 
  

  Annual General Meeting (May 29, Bilbao): Investors will closely monitor the vote on the record supplementary dividend of €0.427 per share, the reelection of Pedro Azagra as CEO, and the approval of the 2026-2028 LTIP incentive plan.

  
  


• 
  

  Intraday price movement: the share price is approaching €20; the market will test whether Barclays’ new target acts as an additional catalyst.

  
  


• 
  

  Consensus view: It remains to be seen whether other investment banks will raise their valuations following Barclays’ move.

  
  


• 
  

  Investment plan execution: Any updates on capital deployment in the four priority markets, particularly in grids and renewables, will be key to validating the British bank’s growth projections.

  
  

With record profits of 6.285 billion euros in 2025 and investments of 14.460 billion euros, Iberdrola heads into the final stretch of May backed by one of the most positive analyst reports it has received in the past year.