AGL – Citi rates the stock as Buy

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Under pressure from the Federal Government, AGL has announced an extension of its customer loyalty program, which could see some customers receive an automatic discount of up to -10%. Citi analysts point out the incremental number of benefiting customers from the announcement is likely quite small.

All in all, Citi analysts believe the bottom line impact will be minor, and definitely smaller than investors would have feared. Citi had upgraded its rating to Buy on Friday. That rating is hereby reiterated. Target price $20.27.

Sector: Utilities.

Target price is $20.27.Current Price is $18.56. Difference: $1.71 – (brackets indicate current price is over target). If AGL meets the Citi target it will return approximately 8% (excluding dividends, fees and charges – negative figures indicate an expected loss).

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