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Investing.com - JPMorgan has reduced its price target on Worley Ltd (ASX:WOR) to AUD16.45 from AUD17.70 while maintaining an Overweight rating on the engineering services company.
The adjustment comes as JPMorgan forecasts global capital expenditure across Energy, Chemicals, and Resources sectors to grow just 1% in FY25 before declining 2% in both FY26 and FY27.
JPMorgan now projects Worley’s revenue growth at 3% in FY26 and 8% in FY27, below current market consensus estimates of 5% and 10% respectively, to better align with the expected capital expenditure environment.
Despite these revisions, JPMorgan notes that consensus capex estimates haven’t deteriorated further over the past 12 months, suggesting the macro environment hasn’t worsened despite recent policy uncertainty.
The firm continues to view Worley favorably long-term, citing its attractive valuation, strong balance sheet, and diversified project backlog, while suggesting the year-to-date share price performance already reflects investor expectations of slowing revenue growth in FY26.
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