The AGL Energy Ltd (ASX: AGL) share price closed lower on Wednesday. However, market onlookers are likely more concerned with what may lie ahead amid a tornado of developments.
At the final bell, shares in the energy retailer stood a little lower than where they finished up yesterday. Nursing a minor loss, AGL shares ticked down 2.3% to $6.87, taking the share price fall to 12.4% over the past month.
There's a fair chance shareholders have grown anxious as rumblings turn into unravellings. On Monday, we reported on the company's significant management overhaul. This included the exit of former chair Peter Botten AC, non-executive director Diane Smith-Gander AO. Additionally, CEO Graeme Hunt will bow out at the end of the month.
So, what is next on the cards for AGL?
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Next steps to be revealed
The next significant item awaiting AGL shareholders is the company's strategy day later this month. This is when the new-look management team will disclose the findings of its strategic review. In addition, investors will receive more detail on AGL's FY23 earnings guidance.
Notably, the news could act as a major catalyst for the AGL share price. Albeit, that will be dependent on how it compares to expectations. Speaking of which, Barrenjoey analyst Dale Koenders is eyeing $269 million in net profits after tax (NPAT) to be guided for FY23.
This forecast was shared alongside the analyst's upgrade to AGL, improving to neutral ahead of the update. However, Koenders caveated this with the belief of near-term risk and further headwinds.
On the positive side, the Barrenjoey analyst is optimistic shareholders could see an earnings recovery in FY25. Given weight to these claims, the team noted an expected benefit as the company rolls over to more attractive contract terms.
Regarding what might be discussed at the strategy day, Koenders said:
We expect the narrative of the strategy will focus on accelerating coal closure, investing significant capital in renewables, and an increase focus on customer engagement and Virtual Power Plants
What could weigh on the AGL share price?
Perhaps AGL's management team wouldn't put it quite this way, but Mike Cannon-Brookes has been loitering since becoming a substantial shareholder. Already, the newly elected chair, Patricia McKenzie, has had to field dissatisfaction with her placement from the tech entrepreneur's Grok Ventures.
The venture capital arm kicked off by Cannon-Brookes highlighted that they want 'fresh thinking'. Whereas, McKenzie was a part of a board that pitched the plans to separate AGL into two — a highly unpopular concept to Grok.
Instead, Cannon-Brookes wants AGL to reinvent itself with a greater emphasise on renewables. However, Koenders points out that this could be a risk to the AGL share price, saying:
The risk is that the narrative again underwhelms but highlights capital limitations and possible equity requirements to fund the transition.
The AGL share price is up nearly 9% year-to-date.
