Analysts Cautious on Centrica Shares – Here’s Why

Centrica (LON: CNA) shares have rallied strongly in recent months, rising 15.9% year to date and gaining 4.5% over the past week.

But despite the upbeat momentum, two major banks turned more cautious on Monday. The stock closed Monday's session down 1.2%.

Morgan Stanley analyst Sarah Lester downgraded the energy group to Equal Weight from Overweight. Although she sees “an attractive evolution in Centrica’s business mix” that could support double-digit earnings growth toward 2029-30, the decision reflects a view that the near-term upside has narrowed.

Lester pointed to the strong run in the shares, up about 20% since September, as well as the completion of the company’s buyback programme without extension and a “lack of near-term catalysts.”

That caution was echoed by Jefferies. Analyst Ahmed Farman cut Centrica to Hold from Buy, even as he raised his price target to 210 pence from 200 pence.

Jefferies cited “negative earnings revisions” and, like Morgan Stanley, flagged the absence of immediate drivers that could push the shares higher in the short term.

Both downgrades suggest analysts believe the recent rally has priced in much of the good news, leaving investors waiting for clearer earnings momentum or fresh strategic developments.

Despite the pullback, the stock remains one of the better performers in the UK utilities sector.