Morningstar cuts fair price estimate for New Zealand's Genesis Energy

Genesis Energy

26/05/2024 19:37

** Analysts at Morningstar cut fair price estimate for
Genesis Energy  GNE.NZ  by 8% to NZ$2.50 
    ** Brokerage downbeat on New Zealand's oil and gas firm's
production prospects from its Kupe oil & gas field 
    ** Company failed to improve flows at Kupe due to inadequate
reservoir pressure, it says, adding production from field will
continue to slide
    ** Sees company relying more on costly coal imports to run
the Huntly power station
    ** However, high electricity prices in case cos fail to
produce more gas in NZ will be a "silver lining" for Genesis’
low-cost hydroelectric schemes - Morningstar
    ** Expects earnings to improve in medium term on renewable
power generation and storage investments, cost-out initiatives,
and higher retail margins 
    ** Stock has fallen ~13% so far this year, as of last close

 (Reporting by Prerna Bedi in Bengaluru)
 ((Prerna.Bedi@thomsonreuters.com; +91 98052 24616;))