Voltalia SA

Morgan Stanley kept its overweight rating on Engie but cut its price target to €29 from €31, while lowering its targets on Veolia and Voltalia, as French utility shares fell on a widening French-German bond yield gap. The brokerage expects Engie to report 2026 recurring net income in the top half of its €4.9 billion to €5.5 billion guidance range, and forecasts 2026 recurring net income of €5.33 billion, about 2% above consensus and 3% above the midpoint of that range. Its 2027-29 estimates are about 6% above consensus, and it sees average total shareholder returns of about 12% over 2026-29. Morgan Stanley identified three potential catalysts: the value of Engie's French gas networks, an update on talks over a Belgian nuclear deal, and new asset sales under the company's €6 billion 2026-28 plan. It kept Veolia at equal-weight but cut its price target to €35 from €38, and raised Voltalia to equal-weight from underweight after a 40% share price fall, cutting its target to €5 from €7. Engie is due to report nine-month results on Nov. 5.

Voltalia reported a 35% increase in second-quarter 2026 revenue at constant exchange rates, reaching 198.0 million euros, driven by new capacity in South Africa and Uzbekistan. Energy sales rose 40% to 118.2 million euros, boosted by new plants, favorable price effects, and the recognition of 17 million euros in compensation for production curtailment in Brazil. The Renvolt services unit grew 26% to 69.6 million euros, while the Voltalia Hub segment advanced 35% to 10.2 million euros. Total capacity in operation reached 3.0 gigawatts, up 17%, and the company confirmed its full-year 2026 financial targets, including EBITDA of 210 to 230 million euros and positive net income, while slightly lowering its capacity target to 3.6 gigawatts from about 3.7 gigawatts due to a selective review of project construction starts.