Analysts diverge on Origin Energy as LNG dividends top estimates
European energy stocks fell sharply Monday after President Trump said new talks with Iran would begin Monday, prioritizing diplomacy. Brent crude fell 5.2% to $83.41 a barrel, and West Texas Intermediate declined 3.3% to $73.94 a barrel.
In London, BP fell 2.1% and Shell dropped 1.2%. France’s TotalEnergies, Italy’s Eni and Spain’s Repsol each declined about 2.2%, while Norway’s Equinor lost more than 3%.
The selloff extended to Australian energy equities, where Origin Energy reported a strong dividend haul but drew contrasting assessments from analysts.
Tom Allen of UBS maintained his buy rating on Origin and told clients that the company received A$911 million in LNG dividends in the 12 months through June — roughly A$110 million more than the consensus forecast. Allen said the result lowered risks around Origin’s annual result announcement and raised the bank’s target price by 0.4% to A$13.45. Origin shares rose 1.6% to A$10.93.
Macquarie analysts took a more cautious view. They warned that Origin’s balance sheet could be constrained by power oversupply dynamics past fiscal 2030, saying government intervention has pushed Australia’s power market into oversupply. The analysts added that the outlook at least into fiscal 2029 appears to be extremely challenged and that it is unclear how the oversupply will clear unless coal generators phase out on schedule, which consensus considers unlikely. Macquarie kept a neutral rating on Origin and lowered its target price 1.6% to A$10.00. Origin shares were up 1.9% at A$10.96.
Separately, Bell Potter analyst Ritesh Varma upgraded Fluence Water Technologies to speculative buy from speculative hold, citing expanding margins. Varma said the company’s first-half gross margin rose to 35.5% from 26.8% a year earlier and that first-half EBITDA was its strongest in at least five years. He kept his target price at 11 Australian cents. Fluence shares rose 2.6% to A$0.08.