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Investing.com - Morgan Stanley upgraded Redeia Corp SA (BME:RED) from Equalweight to Overweight on Wednesday, setting a price target of EUR19.00.
The upgrade reflects Morgan Stanley’s view that Redeia represents "one of the best electricity networks growth stories in European utilities," according to the research note.
After experiencing modest decline in regulated asset base (RAB) from 2019-2024 at approximately -1% CAGR, Redeia is expected to see RAB growth accelerate to 8% CAGR between 2024 and 2030, driven by increasing electricity transmission investment needs.
Morgan Stanley projects this growth, combined with improved regulation, will create an "imminent earnings inflection point" in 2025 and deliver approximately 7% EPS CAGR from 2024-2030, outpacing electricity networks peers that average around 6%.
The firm anticipates Redeia’s next Capital Markets Day, potentially in Q4 2025 or Q1 2026, will serve as a catalyst by highlighting the company’s strong total shareholder return potential of approximately 13% from 2025-2030, compared to electricity peers at around 10%.
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