The AGL share price is falling 5% lower this afternoon

The AGL share price is dropping dramatically today as investors pull the plug after the company’s earnings report…

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The AGL Energy Limited (ASX: AGL) share price is not having a fun day today. At the time of writing, AGL shares are down a nasty 5.26% to $7.20 a share.

We don’t have to look too far to see why this is happening today either. This share price move appears to be a clear reaction to the FY2021 earnings report AGL delivered to its investors this morning.

AGL share price tanks on FY2021 earnings report

As we covered extensively on the Fool this morning, AGL’s earnings report delivered some pretty sobering numbers. The company reported that revenues were down by 10% on the prior corresponding period to $10.9 billion over FY21. That resulted in the company’s underlying profits falling 33.5% to $537 million, and earnings per share (EPS) falling 31.6% to 86.2 cents.

Even AGL’s hefty dividend went backwards. The company will be paying a full-year dividend of 75 cents per share for FY21, down 23.5% from the previous year’s payout. Management blamed lower wholesale electricity prices and reduced generation output as the primary drivers of these results.

Even so, investors have evidently voiced their displeasure through the fall in AGL’s share price today. At the current price of $7.25 a share, the company is presently trading at levels we last saw way back in 2004. The company has now lost more than 40% of its value in 2021 so far, and more than 57% over the past 12 months.

Of course, the next major event shareholders have to look forward to is the upcoming company split that AGL expects will be completed by the last quarter of FY2022. This will result in a new company called Accel Energy owning AGL’s generation assets, while the ‘new AGL’ will house the company’s retail business.

At the current AGL share price, the company has a market capitalisation of $4.51 billion, and a dividend yield of 10.36%.

Should you invest $1,000 in AGL right now?

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Motley Fool contributor Sebastian Bowen has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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