SOUTHERN EUROPEAN INTEGRATED UTILITIES: Since 2012, Southern Europe’s integrated utilities have outperformed their peers by c.100ppts. A new regulatory cycle is about to start, bringing new uncertainty. We expect Portugal, Italy and Spain to introduce significant regulatory changes in 2018-20. Hence, we downgrade EDP to UP (from N), while Enel remains our only OP. We resume coverage of Iberdrola with a N, upgrade Gas Natural Fenosa to a N (from Underperform), and reiterate our N on Endesa. The latter has 14% potential upside but also the highest exposure to Spanish regulatory risk.