AGL Energy (AGLXY) AI Stock Analysis

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AGL Energy

(OTC:AGLXY)

Rating:67Neutral

Price Target:

$7.50

▲(18.11%Upside)

AGL Energy's strong financial performance, particularly in cash flow management, is a key strength. However, challenges in revenue growth, high valuation, and mixed earnings call sentiment temper the overall score. The technical analysis suggests neutral momentum with no strong bullish or bearish signals.

AGL Energy (AGLXY) vs. SPDR S&P 500 ETF (SPY)

Market Cap

$4.28B

Dividend Yield2.71%

Average Volume (3M)1.37K

Price to Earnings (P/E)27.9

Beta (1Y)0.28

Revenue Growth15.16%

EPS Growth-38.34%

CountryUS

Employees3,735

SectorUtilities

Sector Strength77

IndustryIndependent Power Producers

Share Statistics

EPS (TTM)0.35

Shares Outstanding672,747,250

10 Day Avg. Volume0

30 Day Avg. Volume1,369

Financial Highlights & Ratios

PEG Ratio-0.41

Price to Book (P/B)1.22

Price to Sales (P/S)0.00

P/FCF Ratio8.38

Enterprise Value/Market CapN/A

Enterprise Value/RevenueN/A

Enterprise Value/Gross ProfitN/A

Enterprise Value/EbitdaN/A

Forecast

1Y Price Target

$7.50

Price Target Upside18.11% Upside

Rating ConsensusHold

Number of Analyst Covering0

AGL Energy Business Overview & Revenue Model

Company DescriptionAGL Energy Limited supplies energy and other services to residential, small and large businesses, and wholesale customers in Australia. It operates in three segments: Customer Markets, Integrated Energy, and Investments. The company engages in generating electricity through thermal, hydro, wind, and solar power generation plants; gas storage activities; and the retail sale of electricity, gas, solar, and energy products and services. The company operates electricity generation portfolio of 11,208 megawatts; the Newcastle gas storage facility in New South Wales; the Silver Springs underground gas storage facility in Queensland; natural gas production assets at Camden in New South Wales; and the North Queensland gas assets. It serves 4.2 million customer accounts. AGL Energy Limited was founded in 1837 and is based in Sydney, Australia.

How the Company Makes MoneyAGL Energy makes money primarily through its energy retailing operations, where it sells electricity and gas to residential, commercial, and industrial customers. This segment is the largest contributor to its revenue. The company also earns income from electricity generation by operating a diverse portfolio of power plants, including coal, gas, wind, and other renewable energy sources. Additionally, AGL engages in wholesale energy trading, leveraging market price fluctuations to optimize its profitability. Strategic partnerships and investments in renewable energy projects also play a role in sustaining and expanding its revenue streams, as the company transitions to more sustainable energy solutions.

AGL Energy Earnings Call Summary

Earnings Call Date:Feb 11, 2025

(Q2-2025)

% Change Since: -12.65%|

Next Earnings Date:Aug 13, 2025

Earnings Call Sentiment Neutral

The earnings call presented a balanced outlook with several positive aspects such as strong earnings, customer growth, and strategic investments in renewable energy. However, these were tempered by challenges in fleet availability, margin compression, and increased costs, creating a mix of positive and negative trends.

Q2-2025 Updates

Positive Updates

Strong Earnings and Customer Growth

AGL reported strong earnings in line with expectations, with good growth in customer services across energy, telecommunications, and Netflix. Customer satisfaction remains high with a strategic NPS score of +3.

Energy Portfolio Transition and Expansion

AGL's thermal fleet availability factor was lower due to planned outages, but investments in availability and flexibility are expected to drive stronger performance. The development pipeline has grown to 7 gigawatts, with new firming options added.

Financial Performance and Dividend Declaration

Underlying EBITDA was broadly flat, and an interim ordinary dividend of $0.23 per share was declared, fully franked. The company narrowed its FY '25 financial guidance ranges due to strong first-half performance.

Improved Safety and Employee Engagement

Total injury frequency rate improved to 2.8 per million hours worked, with an employee engagement score steady at 72%.

Investment in Renewable and Flexible Energy Technologies

AGL is targeting final investment decisions on 1.4 gigawatts of grid-scale battery projects within the next 12 to 18 months. The Liddell Battery is on track to commence operations in early 2026.

Negative Updates

Lower Thermal Fleet Availability

The thermal fleet availability factor was lower primarily due to planned major coal-fired unit outages, impacting overall performance.

Reduced Consumer Customer Margins

There was margin compression in the consumer gas and electricity portfolios, driven by decisions not to pass through full cost movements and customer switches to lower-priced products.

Higher Depreciation and Amortization

Underlying profit after tax was 7% lower than the prior half, driven by higher depreciation and amortization from continued investment in AGL's assets.

Increased Operating Costs

Operating free cash flow was lower, driven by increased operating costs due to acquisitions and managing outages during the half.

Company Guidance

During the AGL Energy Half Year Results Briefing Conference Call for the fiscal year 2025, several key metrics were highlighted by the management team. AGL reported an underlying EBITDA that was broadly flat compared to the prior half, with an underlying profit after tax of $373 million, marking a 7% decrease from the previous period due to increased depreciation and amortization. The company declared a fully franked interim ordinary dividend of $0.23 per share, maintaining a payout ratio of 50% to 75% of underlying NPAT. AGL's customer satisfaction remained robust, with a strategic Net Promoter Score (NPS) of plus 3, while their customer support package delivered $75 million of the $90 million allocated to assist customers with cost of living pressures. The total injury frequency rate improved to 2.8 per million hours worked. AGL's development pipeline expanded to 7 gigawatts, with the Liddell Battery on track for 2026 operations. The company also increased its flexible fleet capacity to 7.6 gigawatts and targeted final investment decisions on an additional 1.4 gigawatts of grid-scale battery projects within 12 to 18 months. Despite a lower thermal fleet availability factor due to outages, AGL anticipates improved performance and plans to maintain strong cash conversion rates.

AGL Energy Financial Statement Overview

Summary

AGL Energy demonstrates a commendable recovery in profitability and cash flow generation, with strong free cash flow growth and a solid balance sheet. However, the company faces revenue growth challenges, as indicated by a negative revenue growth rate.

Income Statement

Positive

AGL Energy shows a strong recovery in profitability with a significant increase in net income from a previous loss. Gross profit margin improved to 29.43%, and EBIT margin is robust at 20.47%. However, revenue growth is negative at -4.05% compared to the previous year, indicating potential challenges in revenue generation.

Balance Sheet

Positive

The company maintains a solid equity base, with a debt-to-equity ratio of 0.50, indicating balanced leverage. Return on Equity (ROE) is healthy at 13.09%, reflecting efficient equity utilization. The equity ratio stands at 34.67%, showing a stable financial structure, though slightly lower than optimal levels.

Cash Flow

Positive

AGL Energy exhibits strong free cash flow growth of 386.11%, highlighting effective cash management. The operating cash flow to net income ratio is impressive at 3.15, indicating efficient conversion of income to cash flow. The company’s free cash flow to net income ratio is high at 1.97, enhancing its financial flexibility.

Breakdown	Jun 2024	Jun 2023	Jun 2022	Jun 2021	Jun 2020
Income Statement
Total Revenue	13.12B	14.16B	13.22B	10.94B	12.16B
Gross Profit	3.25B	1.15B	1.09B	1.49B	2.26B
EBITDA	2.06B	1.50B	2.11B	-1.73B	2.35B
Net Income	711.00M	-1.26B	860.00M	-2.06B	1.01B
Balance Sheet
Total Assets	15.66B	15.24B	19.27B	15.45B	14.61B
Cash, Cash Equivalents and Short-Term Investments	971.00M	376.00M	341.00M	370.00M	357.00M
Total Debt	2.73B	2.88B	2.88B	3.19B	3.11B
Total Liabilities	10.23B	10.12B	12.75B	9.95B	6.63B
Stockholders Equity	5.43B	5.12B	6.52B	5.50B	7.97B
Cash Flow
Free Cash Flow	1.40B	288.00M	591.00M	555.00M	1.40B
Operating Cash Flow	2.24B	912.00M	1.23B	1.25B	2.11B
Investing Cash Flow	-926.00M	-729.00M	-885.00M	-937.00M	-835.00M
Financing Cash Flow	-530.00M	-159.00M	-303.00M	-366.00M	-1.25B

AGL Energy Technical Analysis

Technical Analysis Sentiment

Negative

Last Price6.35

Price Trends

50DMA

6.63

Negative

100DMA

6.62

Negative

200DMA

6.90

Negative

Market Momentum

MACD

-0.11

Positive

RSI

31.96

Neutral

STOCH

-0.35

Positive

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For AGLXY, the sentiment is Negative. The current price of 6.35 is below the 20-day moving average (MA) of 6.43, below the 50-day MA of 6.63, and below the 200-day MA of 6.90, indicating a bearish trend. The MACD of -0.11 indicates Positive momentum. The RSI at 31.96 is Neutral, neither overbought nor oversold. The STOCH value of -0.35 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for AGLXY.

AGL Energy Peers Comparison

Overall Rating

UnderperformOutperform

Sector (67)

Financial Indicators

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
VST	78 Outperform	$65.49B	30.27	46.29%	0.47%	49.22%	313.49%
NRG	71 Outperform	$29.67B	23.90	44.91%	1.16%	2.57%	-10.19%
AGLXY	67 Neutral	$4.28B	27.92	4.36%	2.71%	15.16%	-38.34%
Sector *	67 Neutral	$16.78B	17.07	4.47%	3.71%	4.76%	6.06%
PAM	61 Neutral	$3.95B	7.53	16.31%	―	8.89%	24.01%
AES	60 Neutral	$9.52B	7.30	29.79%	5.26%	-3.22%	141.11%
ENIC	57 Neutral	$4.76B	25.88	3.67%	10.53%	-12.73%	-74.65%

* Utilities Sector Average

Performance Comparison

AGLXY

AGL Energy

6.35

-0.23

-3.50%

NRG

NRG Energy

151.75

75.99

100.30%

PAM

Pampa Energia SA

71.31

24.76

53.19%

AES

13.37

-3.53

-20.89%

VST

Vistra Energy

193.01

114.39

145.50%

ENIC

Enel Chile SA

3.38

0.72

27.07%

Glossary

BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

Disclaimer

This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.Date of analysis: Jun 19, 2025