In advance of weekend news of a potential takeover for Origin Energy, Morgans penned new research on Origin Energy which led to a downgrade in rating to Hold from Add, on valuation considerations.
The downgrade arose after the broker lowered its target price by -5% to $6.23 in reaction to a 1H underlying profit that came in less than expected. Moreover, more caution is warranted after the uncertainty introduced upon the brought-forward closure of the Eraring coal plant.
Management guidance for FY22 earnings (EBITDA) rose by 5% on strong commodity pricing for APLNG.
Sector: Energy.
Target price is $6.23.Current Price is $5.65. Difference: $0.58 – (brackets indicate current price is over target). If ORG meets the Morgans target it will return approximately 9% (excluding dividends, fees and charges – negative figures indicate an expected loss).
