AGL Energy Limited (AU:AGL)
ASX:AGL
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AGL Energy
(Sydney:AGL)
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Rating:54Neutral
Price Target:
AU$10.00
▲(1.42% Upside)
Action:ReiteratedDate:03/26/26
The score is held back primarily by weak financial performance (negative net margin and severe free-cash-flow deterioration). Technicals are neutral-to-slightly constructive with price above key moving averages but muted momentum. Valuation is supported by a reasonable P/E and a ~5% dividend yield, while the latest earnings call was broadly positive on strategy, liquidity, and battery returns but flagged higher cost pressures and execution risks.
Positive Factors
Integrated gentailer model
AGL’s vertical integration meaningfully reduces exposure to wholesale price swings by matching generation to retail load. That structural hedging capability supports steadier retail margins, improves risk management over multi-year cycles and gives strategic flexibility in contract and asset allocation.
Negative Factors
Severe free cash flow deterioration
A sharp fall in free cash flow constrains the company’s internal funding capacity for CapEx and batteries, increasing reliance on external financing or asset sales. Persistently weak cash conversion erodes flexibility, raises refinancing risk, and can force slower project rollout or dividend cuts.
Read all positive and negative factors
Positive Factors
Negative Factors
Integrated gentailer model
AGL’s vertical integration meaningfully reduces exposure to wholesale price swings by matching generation to retail load. That structural hedging capability supports steadier retail margins, improves risk management over multi-year cycles and gives strategic flexibility in contract and asset allocation.
Read all positive factors
AGL Energy (AGL) vs. iShares MSCI Australia ETF (EWA)
Market Cap
AU$6.63B
Dividend Yield5.17%
Average Volume (3M)2.53M
Price to Earnings (P/E)16.7
Beta (1Y)0.50
Revenue Growth5.96%
EPS Growth-113.79%
CountryAU
Employees3,735
SectorUtilities
Sector Strength65
IndustryIndependent Power Producers
Share Statistics
EPS (TTM)0.53
Shares Outstanding672,747,250
10 Day Avg. Volume2,302,251
30 Day Avg. Volume2,534,418
Financial Highlights & Ratios
PEG Ratio0.59
Price to Book (P/B)1.35
Price to Sales (P/S)0.47
P/FCF Ratio-23.05
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
AU$11.21Price Target Upside13.64% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering7
EPS Forecast (FY)0.95
Revenue Forecast (FY)AU$13.74B
AGL Energy Business Overview & Revenue Model
Company Description
AGL Energy Limited supplies energy and other services to residential, small and large businesses, and wholesale customers in Australia. It operates through three segments: Customer Markets, Integrated Energy, and Investments. The company engages i...
How the Company Makes Money
AGL primarily makes money through a combination of energy retailing and electricity generation, supported by wholesale market participation and customer-related services.
1) Energy retailing (electricity and gas supply to customers): AGL earns re...
AGL Energy Earnings Call Summary
Earnings Call Date:Feb 10, 2026
(Q2-2026)
| % Change Since: |
Next Earnings Date:Aug 19, 2026
Earnings Call Sentiment Positive
The call conveyed a predominantly positive operational and strategic momentum: strong customer growth and satisfaction, expanding development pipeline, excellent battery performance and disciplined capital deployment underpin the company’s transition strategy. Short-term headwinds were acknowledged — namely lower wholesale volatility in the half, increased depreciation and finance costs that weighed on underlying profit, higher net debt from growth spending, and lower employee engagement following restructuring. Management highlighted clear mitigation steps (cost productivity program targeting $50 million p.a., capital recycling such as the Tilt sale, strong liquidity and oversubscribed bond issuance) and reiterated confidence in long-term demand tailwinds and the value of flexible assets.Positive Updates
Solid headline financials
EBITDA of $1.09 billion and underlying NPAT of $353 million for H1 FY26; interim fully franked ordinary dividend of $0.24 per share declared; EBITDA broadly flat versus the prior half despite lower market volatility.
Negative Updates
Underlying profit pressure from higher depreciation and finance costs
Underlying NPAT was impacted by increased depreciation and amortisation (FY26 depreciation & amortisation expected around $860 million after a $40 million revision) and higher finance costs tied to increased borrowings, contributing to lower underlying profit versus the prior period.
Read all updates
Q2-2026 Updates
Positive
Negative
Solid headline financials
EBITDA of $1.09 billion and underlying NPAT of $353 million for H1 FY26; interim fully franked ordinary dividend of $0.24 per share declared; EBITDA broadly flat versus the prior half despite lower market volatility.
Read all positive updates
Company Guidance
AGL narrowed FY‑26 guidance and gave multiple quantified targets: it declared a fully franked interim dividend of $0.24 per share and reiterated a 50–75% payout ratio target for FY‑26 (expecting a fully franked full‑year dividend); expects FY‑26 growth CapEx of ~A$760m (≈A$650m to firming projects) including ~A$190m remaining for the Liddell Battery, ~A$360m of an ~A$800m Tomago cost this year and ~A$85m for K2 turbines (with ~A$100m to follow in FY‑27), while sustaining CapEx is unchanged; depreciation & amortisation is now expected at ~A$860m (revising the uplift down by A$40m); FY‑26 operating costs are now forecast to increase just under 2% (vs prior 3%) and AGL is targeting sustainable net operating cost reductions of A$50m p.a. from FY‑27 after CPI; timing and battery metrics were restated (Liddell first 250MW in Q3 FY‑26 and 500MW by Q4 FY‑26; Tomago operations late FY‑27), the 300MW operational battery fleet delivered A$35m EBITDA in H1 with Torrens annualized yield ~24% and AGL targets the upper end of a 7–11% IRR range for grid‑scale batteries; balance‑sheet and liquidity guidance included ~A$1.2bn cash/undrawn facilities, expected Tilt divestment proceeds of ~A$750m in Q3 and ~A$115m in Aussie Broadband shares from the telco sale, and management said the group is largely hedged for FY‑27.AGL Energy Financial Statement Overview
Summary
Income Statement
45
Neutral
Balance Sheet
55
Neutral
Cash Flow
40
Negative
| Breakdown | TTM | Jun 2025 | Jun 2024 | Jun 2023 | Jun 2022 | Jun 2021 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 14.30B | 13.84B | 13.58B | 14.16B | 13.22B | 10.94B |
| Gross Profit | 1.80B | 2.93B | 2.15B | 1.15B | 1.09B | 1.49B |
| EBITDA | 1.56B | 1.00B | 2.06B | -700.00M | 2.13B | -1.69B |
| Net Income | -101.00M | -98.00M | 711.00M | -1.26B | 860.00M | -2.06B |
Balance Sheet | ||||||
| Total Assets | 15.77B | 16.20B | 15.66B | 15.24B | 19.27B | 15.45B |
| Cash, Cash Equivalents and Short-Term Investments | 307.00M | 332.00M | 971.00M | 376.00M | 341.00M | 370.00M |
| Total Debt | 5.48B | 3.31B | 2.73B | 2.88B | 2.88B | 3.19B |
| Total Liabilities | 11.04B | 11.35B | 10.23B | 10.12B | 12.75B | 9.95B |
| Stockholders Equity | 4.74B | 4.86B | 5.43B | 5.12B | 6.52B | 5.50B |
Cash Flow | ||||||
| Free Cash Flow | -271.00M | -284.00M | 1.40B | 288.00M | 591.00M | 555.00M |
| Operating Cash Flow | 930.00M | 841.00M | 2.24B | 912.00M | 1.23B | 1.25B |
| Investing Cash Flow | -1.43B | -1.56B | -926.00M | -729.00M | -885.00M | -937.00M |
| Financing Cash Flow | 553.00M | 99.00M | -530.00M | -159.00M | -303.00M | -366.00M |
AGL Energy Technical Analysis
Positive
9.86
Price Trends
9.42
Positive
9.19
Positive
9.01
Positive
Market Momentum
0.08
Negative
60.11
Neutral
91.32
Negative
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For AU:AGL, the sentiment is Positive. The current price of 9.86 is above the 20-day moving average (MA) of 9.46, above the 50-day MA of 9.42, and above the 200-day MA of 9.01, indicating a bullish trend. The MACD of 0.08 indicates Negative momentum. The RSI at 60.11 is Neutral, neither overbought nor oversold. The STOCH value of 91.32 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for AU:AGL.
AGL Energy Peers Comparison
UnderperformOutperform
Sector (66)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
80 Outperform | AU$21.25B | 8.87 | 10.39% | 5.30% | 6.48% | 6.25% | |
66 Neutral | AU$13.17B | 36.03 | 6.91% | 6.26% | 4.61% | -90.28% | |
66 Neutral | $17.65B | 18.10 | 5.60% | 3.62% | 6.62% | 11.55% | |
54 Neutral | AU$6.63B | 16.66 | -2.11% | 5.17% | 5.96% | -113.79% | |
43 Neutral | AU$123.26M | -2.52 | -7.47% | ― | -67.88% | -19190.91% | |
| ― | AU$22.23M | 0.08 | -31.05% | ― | ― | 91.54% | |
46 Neutral | AU$11.23M | -0.61 | -108.64% | ― | ― | -15.24% |
* Utilities Sector Average
AU:AGL
AGL Energy
9.86
-0.19
-1.86%
AU:APA
APA Group
9.95
2.51
33.68%
AU:EWC
Energy World Corporation Ltd
0.03
0.02
88.24%
AU:JNS
ReNu Energy Limited
0.19
-0.01
-5.00%
AU:ORG
Origin Energy Limited
12.38
2.07
20.02%
AU:14D
1414 Degrees Ltd.
0.03
<0.01
42.11%
AGL Energy Corporate Events
AGL Energy Declares Interim Dividend of AUD 0.24 Per Share
Feb 10, 2026
AGL Energy Limited has declared an ordinary interim dividend of AUD 0.24 per fully paid share for the six-month period ended 31 December 2025. The stock will trade ex-dividend on 24 February 2026, with a record date of 25 February 2026 and payment...
AGL Energy Half-Year Profit Drops but Dividend Edges Higher
Feb 10, 2026
AGL Energy reported half-year 2025 revenue of A$7.04 billion, down 0.9% year on year, with statutory profit after tax falling 42% to A$94 million and underlying profit slipping 6.4% to A$353 million. Statutory and underlying earnings per share als...
AGL Energy Sets Date and Webcast Details for Half-Year 2026 Results
Jan 18, 2026
AGL Energy will release its half-year results for the period ended 31 December 2025 to the Australian Securities Exchange on 11 February 2026, accompanied by a webcast and pre-registered conference call for investors and analysts, with a transcrip...
AGL Energy Sets Out Indicative 2026 Financial and AGM Timetable
Jan 18, 2026
AGL Energy has released its indicative 2026 corporate calendar, setting out key financial and governance dates for investors and stakeholders, including half-year results on 11 February 2026 with associated dividend dates in February and March, an...
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.