RBC Capital upgrades United Utilities, downgrades Pennon
United Utilities Group
1,026.50p
13:05 09/10/24
RBC Capital Markets upgraded its stance on United Utilities on Wednesday, but downgraded Pennon as it took a look at UK water stocks.
FTSE 100
8,215.34
13:05 09/10/24
FTSE 250
20,791.79
13:05 09/10/24
FTSE 350
4,535.79
13:05 09/10/24
FTSE All-Share
4,493.29
13:05 09/10/24
Gas, Water & Multiutilities
6,030.24
13:04 09/10/24
Pennon Group
555.50p
13:05 09/10/24
Severn Trent
2,537.00p
13:04 09/10/24
The bank lifted United Utilities to ‘outperform’ from ‘sector perform’ and upped the price target to 1,150p from 1,050p. RBC said it was switching to UU as its preferred play in the water space given its view on upside potential into Ofwat’s Final Determinations and a strong balance sheet position.
RBC downgraded Pennon to ‘sector perform’ from ‘outperform’ and cut the price target to 675p from 725p, saying the company’s updated capex guidance means the balance sheet comes under pressure.
Severn Trent was kept at ‘sector perform’, with the price target lifted to 2,600p from 2,500p. RBC said SVT "remains a quality name in the space, in our view, but trades in line with listed network peers, which means we struggle to justify material further upside".
At 1100 BST, UU shares were up 2.4% at 1,030.50p, Severn Trent was up 1.3% at 2,544.60p and Pennon was down 0.4% at 557.00p.