Why is the AGL (ASX:AGL) share price down almost 4% on Tuesday?

Let's find out.

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The AGL Energy Limited (ASX: AGL) share price is having yet another day its investors would probably rather forget. AGL shares finished the day trading at $5.68 each, down a nasty 3.57%.

This latest move means AGL has now lost around 4.7% just this week alone. It's no doubt a disappointing move for many shareholders to watch, especialy seeing as AGL looked to be putting the new 52-week low of $5.22 that the company hit just last Monday behind it.

Last week saw AGL hit its new all-time low on Monday, before the company quickly added more than 12% off of that low by Friday afternoon. However, this week's moves back down have cut that gain. In saying that, AGL does remain almost 9% above its new all-time low at today's pricing. 

So what's gone wrong with AGL shares this week?

share price plummeting down

Image source: Getty Images

AGL share price comes under pressure

Well, it's not entirely clear. There are no major news or announcements out of AGL this week, save for some routine paperwork. Indeed, most of the recent developments surrounding the company could be described as positive. My Fool colleague James discussed a recent broker opinion on AGL shares late last week. These included a buy rating from broker Ord Minnet. That came with a 12-month share price target of $7.55 a share (implying a potential upside of more than 33%). 

Fellow broker JPMorgan has also recently blessed AGL shares with a buy recommendation.

Further, AGL also avoided some strife last week when shareholders declined to give the AGL board a second strike at its annual general meeting, thus avoiding a board spill.

So, therefore, some hawkish investors may have decided that last week's share price rally put AGL over the top in terms of valuation. Perhaps there are simply not enough buyers to keep AGL significantly above its new all-time low that we only saw last Monday.

Today's sharp S&P/ASX 200 Index (ASX: XJO) drop probably hasn't helped AGL out either. So another possible explanation is that investors didn't want to pile into AGL shares in the midst of today's market downturn. 

Whatever the reason for today's hefty pullback in AGL shares, there will be a lot of disappointed investors out there today. 

At the current AGL share price, the company has a market capitalisation of $3.5 billion. It's dividend yield stands at 11.46%.

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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