E.ON: Jefferies maintains sell rating

(CercleFinance.com) - This morning Jefferies has confirmed its sell ("underperform") rating on the share of the German energy company E.
On, after the group published its interim results. At 9.1 euros, the broker's target is close to the share's current price.

Admittedly, the group's underlying operating income (1.5 billion euros) was in line with expectations, and the bank confirmed its forecasts. That said, Jefferies says that the current state of its balance sheet suggests net debt of 19 billion euros at the end of the year, which would exceed consensus expectations of about one billion euros.

The note also highlights the 50% collapse in operating profit at the Customer Solutions division. Although the group has won 100,000 customers in Germany over the first six months, it lost 200,000 customers in the UK in Q2, "which implies an annualised churn-rate of 13%," the broker calculates.



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