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ubs downgrades cgn power stock rating and slashes price target significantly
UBS has downgraded CGN Power Co Ltd. from Buy to Sell, slashing its price target from HK$4.60 to HK$2.00 due to concerns over future profitability amid anticipated energy market challenges. Analysts foresee a significant margin squeeze, driven by a steeper power tariff cut in 2025 and rising fuel costs in 2026, leading to earnings estimates 14-23% below consensus for 2025-2027. UBS favors China National Nuclear Power over CGN Power, indicating a more optimistic outlook for the latter amid industry headwinds.
ubs downgrades cgn power stock amid concerns over future profitability
UBS has downgraded CGN Power's stock rating from buy to sell, slashing the target price from HK$4.60 to HK$2.00 due to concerns over future profitability amid expected challenges in the energy market. Analysts anticipate significant margin compression risks, including a larger cut in electricity tariffs in 2025 and rising fuel costs in 2026, leading to a 20-26% reduction in earnings forecasts for 2025-2027. UBS favors China National Nuclear Power over CGN Power, reflecting a more optimistic outlook for the latter amid industry challenges.