Engie Drops as JPMorgan Says It's Time to Take Profits
Engie was set to end Thursday's session as the second-worst performer on the CAC 40 index, dragged down by a downgrade from JPMorgan analysts, who believe the stock is no longer the "misunderstood value" it once was.
At 5:15 p.m., shares in the energy group were down 2.7%, while the Paris index was losing around 0.7%.
According to JPMorgan, the market now has a better grasp of the company, as shown by the recent narrowing of the valuation gap between Engie and its peers. The stock is currently trading at about 14 times expected 2026 earnings, compared to 10 times at the beginning of last October.
In its note, the research firm points out that the company has regularly exceeded expectations in recent years, despite a challenging environment marked by falling prices and high volatility.
Looking ahead, the firm expects Engie to report 2025 results at the upper end of its target range and to indicate that 2026 should mark the low point for its net profit.
Beyond 2026, JPMorgan forecasts earnings growth of around 5% per year in 2027 and 2028—a scenario that could disappoint investors hoping for a sharper rebound after the expected 2026 trough.
While the firm remains positive on Engie's growth prospects in renewables, with value creation ahead, it has also identified several headwinds, such as a strong euro and weaker-than-expected forward electricity prices in France.
In this context, the stock's recent strong performance seems to offer an opportunity to take profits, JPMorgan concludes, downgrading its recommendation from "overweight" to "neutral" with a price target of 24.5 euros. The firm says it prefers companies with higher earnings growth potential, particularly RWE and SSE.
ENGIE is a major player in the energy transition, whose purpose is to accelerate the transition towards a carbon-neutral economy. With more than 90,000 employees in 30 countries, the Group covers the entire energy value chain, from production to infrastructures and sales. ENGIE combines complementary activities: renewable electricity and green gas production, flexibility assets (notably batteries), gas and electricity transmission and distribution networks, local energy infrastructures (heating and cooling networks) and the supply of energy to individuals, local authorities and businesses.
Every year, ENGIE invests on average EUR 12 billion to drive forward the energy transition and achieve its net-zero carbon goal by 2045.
The turnover achieved in 2025 amounts to EUR 71.9 billion. The Group is listed on the Paris and Brussels stock exchanges (ENGI) and is represented in the main financial indices (CAC 40, Euronext 100, FTSE Euro 100, MSCI Europe) and non-financial indices (DJSI World, Euronext Sustainable - Europe 120 / France 20, CAC 40 ESG, MSCI EMU ESG screened, MSCI EUROPE ESG Universal Select and Stoxx Europe 600 ESG-X).
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