The AGL Energy Limited (ASX: AGL) share price has been well and truly out of form in 2023.
The energy giant's shares have lost 15% of their value since the start of the year.
This compares to unfavourably to a modest 0.9% gain by the ASX 200 index over the same period.
Image source: Getty Images
Why is the AGL share price under pressure?
The main driver of this weakness has been the release of its half-year results from last month.
AGL reported underlying net profit after tax of $87 million, which was a 55% decline on the prior corresponding period. And on a statutory basis, the company posted a loss after tax of $1.1 billion. This includes $706 million of impairment charges from the company's accelerated decarbonisation plans.
This poor first-half performance led to AGL downgrading its FY 2023 underlying net profit after tax guidance to between $200 million to $280 million from between $200 million and $320 million.
Pain may not be over
A recent note out of Morgans reveals that its analysts are wary about AGL's performance in the second half and are doubting its ability to achieve its guidance.
It notes that the company's full-year EBITDA is skewed 46% to the first half and 54% to the second half. However, in the three years prior to COVID, it was skewed the opposite way.
In light of this, it has been named among a collection of shares that could disappoint in August when they release their results. Morgans commented:
Consensus industrial estimates suggest a second half earnings skew (49%:51%) which is curious given the economic backdrop and is at odds with the typical preCOVID first half skew (56%:44%). More specifically, 49% of companies are expected to be skewed to 2H, well above the 25% in pre-COVID times.
Morgans currently has a hold rating and $6.89 price target on AGL's shares.
