The NSW energy roadmap released last week provides some opportunities for AGL Energy, but these are far outweighed by the structural impact, Macquarie notes. The policy will shift the markets to being in structural oversupply. At risk is 24% of NSW-Vic FY24 earnings.
AGL’s developing battery business is an offset, but not near enough. The broker cuts its target to $11.43 from $14.18 and downgrades to Underperform from Neutral.
Sector: Utilities.
Target price is $11.43.Current Price is $13.09. Difference: ($1.66) – (brackets indicate current price is over target). If AGL meets the Macquarie target it will return approximately -15% (excluding dividends, fees and charges – negative figures indicate an expected loss).
