Morgan Stanley assesses AGL Energy and Origin Energy ((ORG)) in light of the demand for power from growth in data centres.

The broker forecasts that there is sufficient power available until 2030.

Origin Energy is currently benefiting from electricity tailwinds. Mark-to-market for commodity and certificate prices boost earnings as does a revised revaluation of Octopus from a third party.

Morgan Stanley lifts the FY24 and FY25 EPS forecasts by 5% and 1%, respectively.

Equal-weight rating and the target price is revised to $9.50 from $9.26. Industry view: Cautious.

Sector: Utilities.

Target price is $9.50.Current Price is $9.93. Difference: ($0.43) - (brackets indicate current price is over target). If ORG meets the Morgan Stanley target it will return approximately -5% (excluding dividends, fees and charges - negative figures indicate an expected loss).

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