DB names its preferred European utilities for 2024

VERBUND AG

15/01/2024 11:27

** Deutsche Bank says the 2024 market outlook for European
utilities looks "neutral to moderately positive", but with
slowing earnings growth as some of the energy crisis boost fades
    ** The brokerage shifts its stock preferences following
sharp outperformance of integrated utilities over pure plays,
particularly those in the renewables sub-sector
    ** "While risky, we believe Orsted  ORSTED.CO  has a chance
to reset, and should be able to avoid a capital raise," DB says,
raising the stock to "buy" from "hold"
    ** The broker ups National Grid  NG.L , Elia  ELI.BR  to
"buy" from "hold" on strong RAB (regulatory asset base) growth 
    ** It raises Redeia  REDE.MC  to "hold" from "sell" after it
significantly underperformed in 2023
    ** It cuts Enel  ENEI.MI  to "hold" from "buy" following
significant outperformance, and Verbund  VERB.MI  to "sell" from
"hold" saying lower wholesale power prices could hurt it
    ** Among regulated utilities, the broker prefers Italgas
 IT.MI , Snam  SRG.MI  (both "buy"), National Grid and Elia
    ** In renewables, it likes Orsted  ORSTED.CO  and OX2
 OX2SE.ST  ("buy")
    ** For integrated names, DB recommends E.ON  EONGn.DE , SSE
 SSE.L , Engie  ENGIE.PA  and RWE  RWEG.DE  (all "buy")

 (Reporting by Tiago Brandao)
 ((Tiago.Brandao@thomsonreuters.com;))