Enagas Advances After Exceeding Analyst Estimates: Madrid Mover

Enagas SA, the operator of Spain’s natural-gas pipelines, jumped the most in three months in Madrid trading after quarterly earnings beat analyst estimates.

Enagas rose as much as 3.7 percent, the biggest gain since April 23, and was up 3.6 percent at 19.44 euros as of 2:30 p.m. local time. It led gains in the Europe 600 Utilities Index.

Second-quarter earnings before interest, tax, depreciation and amortization totaled 270.2 million euros ($356.1 million), Enagas said today in a statement. That’s about 4 percent ahead of average analyst estimates compiled by Bloomberg, the biggest profit surprise in at least 10 quarters.

“Enagas still has room to outperform,” said Bruno Silva, an analyst at Banco BPI SA who recommends buying the shares. The utility “offers an attractive risk-reward proposition,” he said in a note e-mailed today.

Enagas reported net income of 107.2 million euros in the quarter, an 8.4 percent increase from a year earlier. The Madrid-based company is on course to raise net by about 5.5 percent in 2013, Chairman Antonio Llarden said today.

The stock has advanced 20 percent this year in Madrid. It’s the only Iberian utility offering “equity upside” after Spain this month announced power-market reforms, Deutsche Bank AG said July 19. Companies including Iberdrola SA and Endesa SA slumped on news of the reforms, set to cost utilities 2.7 billion euros.

The energy-market measures don’t affect regulations governing Enagas, Llarden said today.