Drax Share Discussion Threads

[minerve 2] 03/5/2019 12:05

catscats

It is the recent carbon objectives that hit the share yesterday. Drax have got some gas assets that will be of concern. They have acquired some more recently although management are acutely aware of the needs to manage these down as we go forward. I don't think it is anything we should be too concerned about ATM.

[catscats] 21/3/2019 09:10

anyone know why this has sold off this morning...?

[minerve 2] 11/3/2019 17:24

Failures and the date of collapse include:

National Gas and Power - July 2018 (80 non-domestic customers)
Iresa - July 2018 (100,000 domestic customers)
Gen4u - September 2018 (500 domestic customers)
Usio Energy - October 2018 (7,000 domestic customers)
Extra Energy - November 2018 (108,000 domestic and 21,000 business customers)
Spark Energy Supply Limited - November 2018 (290,000 domestic customers)
OneSelect - December 2018 (36,000 domestic customers)
Economy Energy - January 2019 (235,000 domestic customers)
Our Power - January 2019 (38,000 domestic customers)


Another one bites the dust today - Brilliant Energy (not that brilliant! he he).

[rburtn] 15/2/2019 12:23

I am always suspicious of firms buying in their own shares that it might be to meet the demands of an influential holder wishing to get out. Wonderful timing this downgrade - just after the buyback finishes. If Citi had sold into the buyback, what a wonderful shorting opportunity their downgrade now makes for them. I'm not saying a thing though!

[minerve] 15/2/2019 11:41

We update our earning and PT to reflect the latest commodity prices and acquisition of IBE generation assets. Our EBITDA is -1% to +49%, while our EPS is +70% to -46% over 2018-20E. 12m PT now at 320p.

Ends.

[minerve] 15/2/2019 11:41

Capacity payment will contribute to c.15% of Drax’s EBITDA (normalized for FY19-21). While our working assumption is that the capacity market resumes in FY20 with no major changes to the structure of the auction process thereafter, there is no guarantee that this would be the outcome. Furthermore, we see Ofgem’s strategic review of the microbusiness retail market to increase level of competition and/or intervention. Drax shares are currently priced as if neither such risks exist.

[minerve] 15/2/2019 11:41

The correlation between Drax share price and commodity prices appears to be broken. Since January, Drax shares are +10% vs -10% of UK power and gas. In our view, this decoupling is unjustified and we see significant downside risk to Drax’s share price.

[minerve] 15/2/2019 11:41

Citi - courtesy of FT Markets live

We believe the purchase of IBE generation assets is value destructive, to the tune of c.£140m. Despite a +20% in UK generation from intermittent renewable sources, similar pump storage assets have actually seen a reduction to peak / off peak spreads from c.£12/MWh to £7/MWh. This together with an expected 10x increase in UK’s utility scale battery storage capacity to 2025, and a 3x increase in UK’s interconnection capacity to 2022, we see little reason to be bullish on the outlook for pump storage assets.

[liam1om] 15/2/2019 11:38

Not a holder, but probably an indication someone wants to load up before the results. Very common for a broker to downgrade before stellar results.

[victorjohn] 15/2/2019 11:14

Perhaps an indication that the full-year results for year ending 31 December 2018 are going to be disappointing?

[liam1om] 15/2/2019 10:59

Citigroup has downgraded Drax Group to Sell with a price target of 320.00p

[essential] 15/2/2019 10:13

Ideas behind the drop?

[minerve] 08/2/2019 12:24

rburtn

I'd agree with what you say but perhaps they said the same thing after the first installation of a solar panel or windfarm.

[skinny] 08/2/2019 11:48

Won't that increase acid rain.

Anyway ,

[minerve] 08/2/2019 10:37

rburtn

I don't think it is idiotic. There are plenty of issues to be addressed but it is one part of the problem that has been shown to work at plant level. Good on them IMO. I am pleased I am an investor in Drax.

[castleford tiger] 08/2/2019 10:33

i THINK YOU will find it saves a shed load of money

Tiger

[rburtn] 08/2/2019 10:29

Idiotic - unless they can sell it to fizzy drinks firms.

[minerve] 08/2/2019 09:50

The UK’s biggest power plant, Drax, has started capturing carbon dioxide from its flue gas — the first time carbon has been captured from a wood-burning power plant anywhere in the world. - FT

[scotches] 18/1/2019 14:40

One month on - What weakness?



Does the Welsh nuke cancellation assist here?

[wbecki] 18/12/2018 16:33

Schroders seem to be offloading bit by bit it seems

12th Dec'18:-”Schroders reduces stake to 12.94%(13.255%)̶1;

17th Dec'18:-”Schroders reduces stake to 12.118%(12.94%)̶1;

18th Dec'18:-”Schroders reduces stake to 11.879%(12.118%)R21;

So presumably this has accounted for the weakness?

Sentiment around Utilities pretty lacklustre as well

[robi_n] 05/12/2018 19:46

Falling like a stone for no apparent reason...

[minerve] 30/11/2018 17:31

Castleford

It is a situation that should be looked at with regard to protecting supply of energy during situations of demand. It is expected to be overruled, but before you join in the witch hunt against the Europeans it was actually a UK competitor that raised the complaint!

[castleford tiger] 30/11/2018 17:20

Great let’s hope we don’t get a prolonged cold spell then!
European madness again
Tiger