JPMorgan starts Harbour Energy at 'overweight'

(Sharecast News) - JPMorgan Cazenove initiated coverage of Harbour Energy on Tuesday with an 'overweight' rating and 298p price target. The bank said its stance was underpinned by scale-driven cost reductions, free cash flow resiliency, and a strong balance sheet which, in its view, "leaves runway for an additional buyback program in 2026".

JPM noted that Harbour is the largest London-listed independent oil and gas producer and said it has recently transformed into a global operator with significant scale following its Wintershall Dea acquisition in 2024.

"The acquisition puts Harbour in a relative position of strength against a weakening commodity outlook (JPM Commodities team forecasts $58/bbl Brent and $8.70/mmbtu TTF in 2026) given its cost improvement runway," JPM said.

"Additionally, the company's dividend (circa 8% yield) is secure at $46/bbl Brent on our estimates, meaning its free cash flow resiliency and strong balance sheet leaves room for supplementary buybacks in 2026."

At 0935 BST, the shares were up 1.2% at 229p.