AGL Energy Limited (ASX: AGL)

We maintain AGL as one of our high conviction long-term buys. Our BUY rationale is anchored in AGL’s pivotal role in Australia’s energy transition. While the company has issued moderated FY25 earnings guidance, we look through near-term volatility and remain focused on structural value creation from decarbonisation. AGL’s expanding renewable energy and battery storage pipeline, coupled with a strong rebound in cash generation, underscores the fundamental transformation underway. The strategic partnership with Kaluza is a key enabler of retail transformation, accelerating AGL’s shift to a more flexible, tech-driven energy provider. Notably, the reinstatement of fully franked dividends strengthens the investment case and reflects growing financial resilience. From a technical standpoint, AGL has traded within a $8.34–$12.27 range over the past year and is currently changing hands around $10.98. While the stock has eased -6.31% over the last 90 days, recent price action has been constructive, gaining 6.29% over the past 30 sessions and trading above its 20-day moving average. This indicates near-term market strength. We see solid technical support around the $10.06 level, offering a potential entry point for long-term market participants. Notably, buy-side volume around $10.81 has surged by 62% over the last 90 days, a bullish signal. Trade Recommendation: Market participants may consider entering within the $10.23–$10.98 range. We are targeting a primary price objective above $12.10, with a secondary target at $13.25.