Analyst Ajay Patel of Goldman Sachs maintained a Buy rating on SSE, with a price target of p2,267.00.
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Ajay Patel has given his Buy rating due to a combination of factors that highlight SSE’s potential for growth and stability. The decision by the Department for Energy Security and Net Zero to maintain the current national approach to wholesale energy prices is seen as favorable for SSE, as it mitigates potential risks associated with zonal pricing. This stability supports SSE’s strategic focus on expanding its network and renewable energy capabilities, which are expected to drive significant earnings per share growth through 2031.
SSE’s ambitious capital expenditure program, amounting to approximately £17.5 billion, is fully funded through 2027 and focuses heavily on networks and renewables. The company aims to nearly double its renewable capacity, with a projected net addition of around 3GW. Clarity on substantial investments in renewables and transmission over the next 12-18 months is anticipated to enhance earnings visibility post-FY 2027, contributing to potential multiple expansion. Ajay Patel’s 12-month price target of 2,267p reflects a blend of M&A and fundamental valuations, underscoring the expected value unlock as SSE progresses with its investment plans.
According to TipRanks, Patel is a 5-star analyst with an average return of 17.6% and a 61.92% success rate. Patel covers the Utilities sector, focusing on stocks such as SSE, Centrica, and Severn Trent.
In another report released on July 3, J.P. Morgan also maintained a Buy rating on the stock with a £23.00 price target.