Centrica PLC
CNA: XLON (GBR)
Morningstar Rating for Stocks | Fair Value | Economic Moat | Capital Allocation |
---|---|---|---|
GBX 896.00 | Bjl | Gjzjypx |
Reopening Rough Storage Site Will Boost Centrica's Short-Term Earnings; Shares Grossly Undervalued
We maintain our fair value estimate of GBX 130 per share after no-moat Centrica announced it reopened its Rough gas storage facility on Oct. 28 after being granted a 10-year license. This should boost short-term profits. On the other hand, Centrica confirmed its willingness to ultimately convert Rough to store hydrogen, which could be value-accretive should the firm get a regulated remuneration scheme. Shares are materially undervalued.