The AGL Energy Limited (ASX: AGL) share price is having another poor session.
In morning trade, the energy company's shares are down 3.5% to $6.87.
This means the AGL share price is now down more than 13% since the release of the company's half year results.
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Is the AGL share price weakness a buying opportunity?
Unfortunately, one leading broker doesn't believe investors should be jumping in just yet.
According to a note out of Morgans, its analysts have retained their hold rating and cut their price target on the company's shares by 12.5% to $6.89.
This is broadly in line with where AGL's shares trading today.
What did the broker say?
Morgans wasn't impressed with AGL's half year results, which fell short of expectations. It commented:
AGL's 1H result was a significant miss on consensus and our forecast and FY23 underlying net profit guidance was reduced by $20m. […] Underlying net profit was down 55% on pcp, 60% on our forecast and 45% on Visible Alpha consensus. The key driver was a net $123m impact on the wholesale trading business from the tight winter conditions earlier in the half. This also drove a big miss on DPS with an interim dividend of only 8cps.
The top end of FY23 guidance was cut, reducing the mid-point of Underlying net profit guidance by 8% to $240m.
And while Morgans is expecting AGL's performance to improve and its dividends to start increasing, it recommends investors sit on the fence for the time being. It adds:
We anticipate increasing dividends as earnings begin to recover in the next 12 months however we think the market will want to see clear evidence of this before it regains confidence in the company and the sector.
