Morgans expects wholesale market conditions for electricity and gas to result in strong earnings for AGL Energy in FY24-25, and upgrades its rating to Add from Hold. The target price rises to $8.83 from $7.24.
Electricity prices are currently rallying and winter futures prices are also rising given tight conditions in the spot coal market, explains the analyst. Meanwhile, domestic gas prices are also starting to rally with Victorian 2023 gas futures lifting.
Sector: Utilities.
Target price is $8.83.Current Price is $8.03. Difference: $0.80 – (brackets indicate current price is over target). If AGL meets the Morgans target it will return approximately 9% (excluding dividends, fees and charges – negative figures indicate an expected loss).
