LONDON (ShareCast) - (Sharecast News) - Analysts at Berenberg lowered their target price on exploration and production company Energean from 1,750.0p to 1,580.0p on Monday, as a slower than expected ramp-up created cause for concern despite the company's solid cash flow story.
Berenberg said impediments to the ramp-up of Energean's key Karish project due to commissioning challenges on its floating production storage and offloading vessel were now "largely resolved", with commissioning expected to complete in February.

However, Berenberg pointed out that Energean's guidance was below consensus expectations and had a knock-on effect on its full-year 2023 numbers.

"We incorporate updated guidance with the net result a 10% decrease in our price target to 1,580p (from 1,750p), 24% upside from current levels," said Berenberg, which reiterated its 'buy' rating on the stock.

"On our updated forecasts, the shares are trading on FY23/34 EV/EBITDA of 4.5x/3.4x; EV/DACF of 5.4x/4.3x and FCF yield of 3%/25% respectively. Over the longer term, we forecast average a 2023-2030 FCF yield of 27%, more than covering the expected 14% dividend yield once production has ramped up."







Reporting by Iain Gilbert at Sharecast.com

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