RWE AG (0HA0 – Research Report), the Energy sector company, was revisited by a Wall Street analyst today. Analyst Elizabelle Pang from DBS reiterated a Hold rating on the stock and has a €33.00 price target.
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Elizabelle Pang’s rating is based on a combination of factors that reflect both the opportunities and challenges facing RWE AG. The company has shown a commendable performance with its 3Q24 adjusted EBITDA surpassing expectations by 11%, despite the pressure from easing power prices. This indicates a strong operational capability, yet the ongoing soft power prices present a headwind that could affect future profitability.
RWE AG is well-positioned to benefit from the green transition movement in Europe and the US, especially with Germany’s ambitious renewable energy targets and RWE’s significant presence in the US market following its acquisition of Con Edison’s Clean Energy Business. However, the company faces challenges such as potential declines in commodity prices and the risk of windfall taxes, which could impact earnings. Additionally, while the 2024 outlook has been slightly upgraded, the company is exercising greater capital discipline by reducing its capex plans. These mixed factors contribute to the Hold rating, with a target price of EUR33.
In another report released on May 15, Bernstein also maintained a Hold rating on the stock with a €39.00 price target.