RBC Capital upgrades SSE to 'sector perform'

RBC Capital Markets upgraded its rating on shares of SSE to ‘sector perform’ from ‘underperform’ and hiked the price target to 1,400p from 1,150p to reflect greater visibility on dividends and an "attractive" mix of underlying assets concentrated in regulated networks and renewables.

The bank said that at the company’s FY20 results, some of its previous caution proved well founded, with SSE announcing Covid-19 risks to FY21 EBIT of £150-250m and that £2bn of disposals were required to strengthen the balance sheet and maintain dividends.

"Nevertheless, renewed dividend clarity should be well received, and with a strong mix of networks and growing renewable activities, we upgrade SSE," it said.

At 1335 BST, the shares were up 1.4% at 1,410p.