Concerns about SSE PLC's (LSE:SSE) balance sheet are "overdone", said JP Morgan, with the recent share price decline for the power company a "buying opportunity".
The fall in the shares has been driven by rising UK bond yields and concerns around the company’s balance sheet, the US bank said, setting a 2,425p price target implies over 40% upside.
This was based on analysts' refreshed estimates, which imply the FTSE 100 company is trading at 8.5 times 2027 forecast earnings.
JPMorgan expect that the completion of the transmission regulatory review, as well as offshore wind auction results "should pave the way for the company to be able to provide the market with medium-term capex and earnings guidance as well as clarity on how growth will be funded".
"We continue to see SSE’s balance sheet as well positioned to fund investments out to FY29, with the company able to recycle capital through disposals to credibly."