Following the first half, and a 3% beat to Credit Suisse’s earnings forecasts, AGL Energy lifts lower end of full year guidance range, now guiding to earnings of $1,275-1,400, previously $1,200 at the lower end, and profit of $260-340, previously $220m at the lower end.
Despite the positives New AGL, the company’s green energy focused business, showed little progress towards its target of service growth of 500,000 by FY24, and the broker finds Accel’s prospects better with energy price increases driving an improved outlook beyond FY22.
The Outperform rating is retained and the target price decreases to $8.20 from $8.50.
Sector: Utilities.
Target price is $8.20.Current Price is $7.00. Difference: $1.20 – (brackets indicate current price is over target). If AGL meets the Credit Suisse target it will return approximately 15% (excluding dividends, fees and charges – negative figures indicate an expected loss).
