Morgan Stanley assesses AGL Energy and Origin Energy ((ORG)) in light of the demand for power from growth in data centres.

The broker forecasts that there is sufficient power available until 2030.

Accounting for the autumnal gains in plant flexibility and good weather, Morgan Stanley lifts the AGL Energy FY24 EPS forecast by 6% and FY25 is unchanged.

The analyst notes that the FY24 NPAT forecast is at the upper end of the company's range, but at the lower end for FY25/FY26.

Equal-weight rating retained. The target price is revised to $9.50 from $19.18. Industry View: Cautious

Sector: Utilities.

Target price is $9.50.Current Price is $10.27. Difference: ($0.77) - (brackets indicate current price is over target). If AGL meets the Morgan Stanley target it will return approximately -8% (excluding dividends, fees and charges - negative figures indicate an expected loss).

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