Pannergy Rebounds From Record Drop as KBC Raises: Budapest Mover

Pannergy (PANNERGY) Nyrt., a Hungarian renewable energy company, rebounded after KBC Groep NV raised its recommendation for the stock, saying the biggest weekly slump on record was overdone.

The shares rose as much as 8.1 percent and traded 3.3 percent higher at 407 forint by 10:46 a.m. in Budapest. Last week’s 30 percent decline pushed the stock’s relative strength index to 6.8, below the 30 level considered by some analysts as oversold. The RSI last stood at 13.

KBC’s Hungarian broker unit raised its recommendation for Pannergy to buy from hold, while cutting its fair value estimate by 28 percent to 445 forint. Pannergy will manage to complete “large-scale” geothermal projects, including one in the city of Miskolc in eastern Hungary, which has suffered delays, KBC said.

“We believe last week’s deep price drop has created a good buying opportunity,” Peter Szentirmai, a Budapest-based analysts at KBC Securities, wrote in a research report. Last week’s sell-off happened for “technical” reasons, KBC said.

To contact the reporter on this story: Andras Gergely in Budapest at agergely@bloomberg.net

To contact the editor responsible for this story: Wojciech Moskwa at wmoskwa@bloomberg.net