RWE "buy"

14.08.06 - Merrill Lynch

LONDON, August 14 (newratings.com) - Analysts at Merrill Lynch reiterate their "buy" rating on RWE AG (RWE). The target price is set to ?80.

In a research note published this morning, the analysts mention that the revenue cut for regulation may possibly be higher than previously expected, the adverse effect of which on the company's 2006 and 2007 earnings is likely to be countered by an increase in profit assumptions for oil and gas production. The potential Water sale continues to be a significant catalyst for RWE's share price in the forthcoming months, the analysts add.