Centrica‘s (LSE:CNA) share worth has taken a painful dive. At 177.5 per share, the vitality big was final 7% decrease on Thursday (19 February), making it the largest loser throughout each the FTSE 100 and FTSE 250 indices. It was down 9% at one level.
Traders have had a little bit of a shock with their morning espresso, the Footsie agency asserting a full-year income stoop, issuing disappointing forecasts for 2026, and placing the block on additional share buybacks.
The query is, are Centrica shares a gorgeous dip purchase to contemplate?
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What’s occurring?
In a reasonably underwhelming full-year replace, Centrica introduced a 48% crash in adjusted working income for 2025. At £814m, revenue dropped as hotter climate meant households consumed much less electrical energy and fuel.
Earnings at British Gasoline fell 39% to £163m, despite the fact that buyer numbers rose 1% to 7.96m.
That wasn’t Centrica’s solely downside in what CEO Chris O’Shea described as a “difficult” 12 months. At its Centrica Power buying and selling arm, adjusted working revenue greater than halved to £150m. This was properly beneath the corporate’s medium-term revenue goal of £250m-£350m.
The unit was hit by weaker commodity costs and market volatility returning to regular ranges. Centrica Power purchases after which shops fuel when costs are beneficial, then sells it on when values improve.
Triple bother
In addition to asserting these disappointing income, Centrica mentioned it’ll make no additional share buybacks after the £2bn programme that accomplished in January.
O’Shea mentioned that the choice “allows us to prioritise funding that creates lasting worth for shareholders“. Extra particularly, the corporate is investing closely in belongings such because the Sizewell C nuclear plant and the Grain LNG terminal it bought in August.
To cap issues off, Centrica mentioned it expects adjusted earnings of simply £250m in 2026 from its buying and selling enterprise (which incorporates Centrica Power). This displays ongoing market weak point and excessive internet curiosity prices.
In higher information, internet money fractionally beat forecasts at £1.5bn, although this was nonetheless down 48% 12 months on 12 months. Centrica additionally raised the full-year dividend to five.5p in 2025, up 22%.
Is Centrica a Purchase?
At the moment’s worth plunge means Centrica’s price-to-earnings (P/E) ratio for 2026 is 13.5 occasions. That’s beneath the 10-year common of 15-16. However is that low sufficient to encourage me to purchase its shares?
Large funding in areas like nuclear and renewables gives the enterprise with monumental development alternatives trying forward. The issue is the price can also be enormous — whole capital expenditure greater than doubled final 12 months, to £1.2bn — and can stay elevated for the subsequent few years a minimum of, hitting earnings.
The results on Centrica’s share worth and dividends might due to this fact be important, and notably if market circumstances are powerful. The FTSE 100 firm may be price a glance from dip consumers. However I received’t be shopping for it for my portfolio.
