thank you!
hmmm not sure I agree with all of these, with many known pre- Feb 9, when Barrenjoey last valued the company.
1. Old news: Markets incl gov knew there would be a change back in Nov. Hence why all posturing was on dropping from a 40-50% increase to 20-30%.
2. Old news/immaterial: AGL is extremely well hedged on both coal and gas, so this doesn’t significantly impact its business. If anything it erodes their competitive advantage.
3. Old news: Callide C has been out for a long time
https://www.copyright link/companies/energy/still-no-answer-to-catastrophic-failure-at-callide-power-station-20230125-p5cfha, whilst the administration is new news, which comes after BJs new re-rating
4. New news: I agree banks looks shaky as a defensive buy and it makes sense to look at Utilitues, though AGL’s future revenue outlook has been strong for a good year now.
5. Immaterial: Not sure how a future private company receiving compensation helps AGL. Liddell is still closing next month.
6. Old news: Futures pricing has dropped from its highs pre gov intervention though remain elevated <- what AGL management said during the H1 earnings call
If you look at all of BJ’s historical ratings there was more reason to rate it higher previously and I am surprised in one month they found another 45% upside.
Don’t get me wrong, I’m happy to have my investment thesis validated. But a bit miffed at the ‘experts’ slapping effectively a sell with a 12mo target of ~$7.5 since June 2022, but somehow finding ~$2b EV in 1 month…
(20min delay)