JPMorgan downgrades Centrica, cites limited valuation upside

JPMorgan Cazenove downgraded British Gas owner Centrica on Monday to ‘neutral’ from ‘overweight’ and trimmed the price target to 167p from 170p, citing limited valuation upside.

  • Centrica
  • 30 June 2025 10:24:42
Gas stove

Source: Sharecast

"Our analysis suggests that Centrica shares present a balanced risk/reward proposition and we therefore downgrade the stock to neutral," the bank said.

JPM noted that the shares have outperformed the sector by around 290% since 3Q 2020, where it argued that the market underappreciated the group’s balance sheet strength as well as potential earnings upside from restructuring.

"With much of this now realised, and with the normalisation of commodity prices and volatility, we see more limited upside from here," it said.

The bank said its refreshed 2025/2026 earnings per share estimates are 11%/5% below Bloomberg median consensus.

"We expect interim results on July 24th to confirm that Energy Markets & Trading as well as UK Energy Retail market conditions remain challenging, although investors should see these conditions as one-off," JPM said.

At 1020 BST, the shares were down 1.6% at 160.90p.

Exchange: London Stock Exchange
Sell:
0.00
Buy:
0.00
Change: 19.48 ( 0.22 %)
Date:
Prices delayed by at least 15 minutes

Compare our accounts

If you're looking to grow your money over the longer term (5+ years), we have a range of investment choices to help.

Lloyds Bank is not responsible for the content and accuracy of the Markets News articles. We may not share the views of the author. Understand the risks, please remember the value of your investment can go down as well as up and you may not get back the full amount you invest. We don't provide advice so if you are in any doubt about buying and selling shares or making your own investment decisions we recommend you seek advice from a suitably qualified Financial Advisor. Past performance is not a guide to future performance.

Important legal information

Lloyds and Lloyds Bank are trading names of Halifax Share Dealing Limited. The Lloyds Bank Direct Investments Service is operated by Halifax Share Dealing Limited. Registered Office: Trinity Road, Halifax, West Yorkshire, HX1 2RG. Registered in England and Wales no. 3195646. Halifax Share Dealing Limited is authorised and regulated by the Financial Conduct Authority, 12 Endeavour Square, London, E20 1JN under registration number 183332. A Member of the London Stock Exchange and an HM Revenue & Customs Approved ISA Manager.

Logo Allfunds

The information contained within this website is provided by Allfunds Digital, S.L.U. acting through its business division Digital Look Ltd unless otherwise stated. The information is not intended to be advice or a recommendation to buy, sell or hold any of the shares, companies or investment vehicles mentioned, nor is it information meant to be a research recommendation. This is a solution powered by Allfunds Digital, S.L.U. acting through its business division Digital Look Ltd incorporating their prices, data news, charts, fundamentals and investor tools on this site. Terms and conditions apply. Prices and trades are provided by Allfunds Digital, S.L.U. acting through its business division Digital Look Ltd and are delayed by at least 15 minutes.

FE fundinfo Logo

Data provided by FE fundinfo. Care has been taken to ensure that the information is correct, but FE fundinfo neither warrants, represents nor guarantees the contents of information, nor does it accept any responsibility for errors, inaccuracies, omissions or any inconsistencies herein. Past performance does not predict future performance, it should not be the main or sole reason for making an investment decision. The value of investments and any income from them can fall as well as rise.

Refinitiv Logo

© 2025 Refinitiv, an LSEG business. All rights reserved.