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Investing.com - Oppenheimer has raised its price target on Talen Energy (NASDAQ:TLN) to $405.00 from $315.00 while maintaining an Outperform rating on the stock. The new target represents modest upside from the current price of $374.78, though InvestingPro analysis suggests the stock is currently trading above its Fair Value.
The revision follows Talen Energy’s second-quarter 2025 EBITDA of $90 million, which fell slightly below Oppenheimer’s and Wall Street’s estimates of $95 million, reflecting an extended outage at the Susquehanna facility.
Despite the EBITDA miss, Talen Energy reported revenue of $630 million, significantly exceeding analyst expectations of $425 million and the Street’s $392 million forecast, primarily driven by higher capacity revenues.
PJM market prices increased to $52.71/MWh in the second quarter of 2025, up from $37.67/MWh in the comparable period, supported by tighter supply and demand dynamics, even as weather was cooler than in the second quarter of 2024.
Oppenheimer’s increased price target reflects Talen Energy’s anticipated benefits from higher 2025/2026 PJM capacity pricing, impacts from RMR arrangements beginning in the second half of 2025, and the expected closing of the CCGT transaction by year-end, with the firm now projecting FY26 EBITDA of $2 billion, up from its previous estimate of $1.4 billion.
In other recent news, Talen Energy announced its acquisition of two combined-cycle gas-fired power plants for a net price of $3.5 billion, with tax benefits considered. The plants, located in Pennsylvania and Ohio, are part of the PJM power market. UBS has responded to this development by raising its price target for Talen Energy to $399, citing the acquisition’s potential to add significant value to the stock. Oppenheimer also increased its price target to $315, reflecting the upsized power purchase agreement between Talen’s Susquehanna facility and Amazon (NASDAQ:AMZN) Web Services. Meanwhile, Jefferies adjusted its price target to $326, noting Talen’s significant exposure to the PJM capacity auction. UBS previously raised its target to $366, highlighting Talen’s strong power fundamentals and strategic asset mix. These recent developments indicate a mix of strategic acquisitions and partnerships contributing to Talen Energy’s evolving market position.
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