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(Sharecast News) - Analysts at Berenberg lowered their target price on Energean from 850p to 780p as it updated its model for the company's FY25 trading update.
Berenberg said Energean's update highlighted "a solid 2025" in terms of operational performance, with production at the top end of the recent guidance range.
However, Berenberg noted that guidance for 2026 was lower than consensus in terms of production, and higher than consensus in terms of capex and net debt.
In addition, Berenberg highlighted that Energean noted operational challenges at its important Cassiopea gas field in Italy - leading to a reserves downgrade, impairment and arbitration with the operator.
"On our updated forecasts, Energean trades on 2027 EV/EBITDA of 5.1x and EV/DACF of 4.0x," said the German bank, which has a 'hold' rating on the stock.
"We reduce our 2026 production forecast by 16%, contributing to a 19% and 22% reduction in our 2026 revenue and EBITDA forecasts respectively. Our 2026 year-end net debt forecast has increased by 13% to $3,278m, the upper end of guidance. Baked into net debt guidance is an expectation of improved recovery of receivables in Egypt; we think it prudent to take a cautious view of this given the country's track record on receivables in recent years."
Elsewhere, Canaccord Genuity lowered its target price on mental health services provider Kooth from 430p to 330p on Wednesday, but said the stock still represents a "buying opportunity".
Canaccord stated Kooth shares have "underperformed materially" over the last 18 months due to uncertainty around the July 2027 renewal of a major contract in California, as well as subdued growth in the UK.
The Canadian bank noted that with the valuation at historic lows of 0.3x FY26E enterprise value/sales and 4.6x EV/EBIT, its deep dive suggested "strong upside from here".
On a standalone basis, Canaccord estimates Kooth's UK and US business, except California, to be worth roughly 125p, broadly in line with the current share price. With net cash making up another 60p per share, the analysts believe the current valuation already bakes in their zero or negative value for California.
"We view this as unwarranted, as our scenario analysis suggests renewal at ~30-50% lower revenues could deliver annualised cash EBITDA of $3-4m, in line with our estimate for the current contract run rate of $4m," said Canaccord.
In the unlikely event that California does not renew, our SOTP indicates upside to 225p in 2027. Following today's trading update, we reduce estimates but expect a return to profit and earnings growth as investments taper. We believe the current valuation materially undervalues the business and reiterate 'buy' with our target reduced to 330p but offering >160% upside potential."
Reporting by Iain Gilbert at Sharecast.com