2352 GMT - The more than 8% drop in Origin Energy's share price that followed a downgrade to annual production guidance for the Australia Pacific LNG project was overdone, contends UBS. The stock reaction ignores several tailwinds that could trigger upgrades to consensus earnings expectations for FY 2026, analyst Tom Allen says. They include a 15%-20% decline in current coal prices, UBS says, noting 45% of Origin's coal costs are unhedged. Origin also wants to expand a battery at the Eraring power station in Australia to become one of the largest battery storage systems in the world. "We do not believe these incremental earnings (A$100 million per annum from 2H FY 2026) are factored into consensus estimates," UBS says. It keeps a buy call on Origin's stock. (david.winning@wsj.com; @dwinningWSJ)
(END) Dow Jones Newswires
February 03, 2025 18:52 ET (23:52 GMT)
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