What's going wrong for the AGL (ASX:AGL) share price in November?

The energy provider's shares have been having a difficult time of late. We take a closer look

| More on:

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

The AGL Energy Limited (ASX: AGL) share price has continued its declining trend, falling to near multi-decade lows this month. Investors have continued to dump the energy company's shares, leading to a 12% loss in the past month alone.

During early morning trade, AGL shares are adding more pain to shareholder portfolios, down 0.55% to $5.43 apiece.

Group of thoughtful business people with eyeglasses reading documents in the office.

Image source: Getty Images

What's the go with AGL?

It's been a relatively quiet couple of months for AGL with the last market-sensitive news out of the company being its full-year results in August.

However, a catalyst dragging down the AGL share price might be tough conditions for the national electricity market along with unstable electricity prices.

The company previously noted that a sharp decline in wholesale prices for electricity and renewable energy certificates affected its financial performance. AGL regarded the 2021 financial year as one of the most difficult energy markets on record.

In addition, the increased demand to decarbonise its operations has impacted Australia's largest carbon emitter. Nonetheless, management plans to turn around its fortunes for AGL to become a more agile business towards renewable energy.

At its annual general meeting (AGM) in September, AGL recognised the disappointing result and aimed to change its fortunes around.

As such, management has focused on reducing operating costs by $150 million by the end of FY22. Also, the sale of non-core assets for $400 million by the end of FY22 is expected to provide ample firepower to the company's balance sheet. The AGL share price gained 3% on the back of this news.

More than half the company's shareholders voted in favour of AGL setting emission targets ahead of its demerger. This is in accordance with the Paris Agreement which sets out a global framework to combat climate change.

The soon-to-close Liddell coal-fired power station could be a sign of greener pastures. AGL plans to transform the site with a hydro and solar energy facility after Liddell's shutdown in 2023.

The company is aiming to split into two separate businesses by June 2022. They are bulk power generator, AGL Australia, and a carbon-neutral energy retailer, Accel Energy.

About the AGL share price

In 2021, the AGL share price has continued to plummet in value, losing around 55% for investors. When looking at the last 12 months, its shares are down almost 60%.

Based on valuation metrics, AGL presides a market capitalisation of approximately $3.59 billion, with approximately 658.38 million shares outstanding.

Motley Fool contributor Aaron Teboneras 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.

More on Energy Shares

Woman looking at data on her laptop.
Energy Shares

Channel Infrastructure secures $130m bp storage contract in Marsden Point growth plan

Channel Infrastructure NZ announces a $130 million bp storage contract and major plans for fuel resilience at Marsden Point.

Read more »

An oil refinery worker checks her laptop computer in front of a backdrop of oil refinery infrastructure.
Earnings Results

Horizon Oil FY26 results: Record production and expanding platform

Here's what the oil producer reported for the year.

Read more »

Oil worker using a smartphone in front of an oil rig.
Earnings Results

Karoon Energy half-year earnings: FY26 results and outlook

Let's see what the energy producer reported for the first half.

Read more »

a group of three electricity workers stand smiling wearing hard hats and high visibility vests in front of an array of high voltage power equipment.
Energy Shares

Boss Energy reports profit turnaround and more uranium production in FY2026

Boss Energy delivered a $2.5 million profit and doubled revenue as Honeymoon production ramped up in FY2026.

Read more »

A uranium plant worker in full protective gear removes his head covering and holds it in his hand as he smiles slightly to have his picture taken.
Energy Shares

Deep Yellow delivers key Tumas milestones and secures project progress in Namibia

The company has completed key Tumas Project milestones, securing water supply and finalising local ownership in Namibia.

Read more »

Numerous Australian dollar notes laid out.
Dividend Investing

How many Woodside shares do I need to buy to earn $10,000 a year in passive income?

Atop its soaring share price, I think Woodside is an attractive passive income investment.

Read more »

Man holding out Australian dollar notes, symbolising dividends.
Dividend Investing

Everything you need to know about the Woodside dividend

Here’s how big the next dividend will be.

Read more »

Hand flipping wooden cube block to change between up and down with percentage sign symbol next to it.
Energy Shares

Here's what brokers tip for Woodside shares over the next 12 months

Are the shares a buy after the oil and gas giant posted its FY26 results this morning?

Read more »