The thing with AGL is it has structural head winds against earnings. Under the current regulatory and pricing model renewables will continue to drive down electricity prices as they will bid on at far lower prices than coal, gas, diesel etc. Eventually prices will be so low as to prevent investment in infrastructure and the model will need to change. Unfortunately it will need to get to that breaking point before anyone does anything about it.
It also has significant expected costs decommissioning the coal plants and well as the the movement away from companies with environmental concerns.
None of these things are changing anytime soon.
At some stage this may become a recovery play but there are many structural issues that have yet to play out. Who knows how long that will be, could be years.
DYOR
AGL Price at posting:
$7.45 Sentiment: Sell Disclosure: Not Held
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