The British Gas owner is betting its future on contracted infrastructure assets, but the retail and trading businesses still have something to prove
Nuclear power is doing the heavy lifting in Centrica PLC's (LSE:CNA) revised growth story.
RBC Capital Markets lifted its price target on the British Gas parent to 225p from 215p, after the company formally extended the operating lives of four of its five nuclear facilities, adding around £300m to projected EBITDA by 2030.
The infrastructure buildout is the cleaner part of the thesis. Stakes in Sizewell C, Isle of Grain, and smart meters give the business a growing base of contracted, long-life cash flows that analysts can model with reasonable confidence.
RBC forecasts roughly 12% EPS growth per year through 2030, though its estimate sits slightly below management's own 22p target as visibility on the retail and optimisation divisions remains limited.
Those two segments are where the work still needs to be done. The trading arm guided £250 million for 2026, below its own medium-term range. The retail business faces stubborn affordability pressure among UK households.
A £600 million cost transformation programme is meant to close the gap, but the market will want evidence before giving it full credit.
The Rough gas storage decision, expected from the government this spring, is the next near-term catalyst.
Centrica shares, up 12% year-to-date, were trading at 194.8p late afternoon, up 2% on the day.