Credit Suisse downgraded Constellation Energy to Neutral from Outperform with a price target of $83, down from $91. The company’s Q4 results last week leaves risk-reward more balanced for shares amid a lower ongoing free cash flow outlook, mainly due to cost pressures and increases in nuclear fuel spending, the analyst tells investors in a research note. The firm adds that while Constellation Energy guided for "strong" FY24 gross margin, its capital expenditures were also considerably higher. Credit Suisse added that given the single-digit free cash flow yield and with the "well-previewed" capital allocation update now out of the way, the stock "looks expensive".
Published first on TheFly
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