CEZ AS advanced for an eighth day, its longest rally in more than 19 months, after the biggest Czech utility won a contract to supply electricity to state railways and on bets the company will exceed its profit target.
The stock increased 0.5 percent to 767 koruna at the close in Prague, adding to a 2.8 percent gain last week to the highest in four months. The last time CEZ climbed for eight consecutive days was in January 2011.
CEZ has gained 11 percent this month, helped by higher-than-expected profit for April to June. Czech Railways will buy power from CEZ next year for 1.76 billion koruna ($89 million), the utility’s spokeswoman Barbora Pulpanova said by phone today.
“Such an amount is significant even for a company the size of CEZ,” Josef Nemy, an analyst at Komercni Banka AS, wrote in a report today. “Some investors seem to be speculating that CEZ will manage to exceed its full-year earnings guidance,” he said in a separate response to e-mailed questions from Bloomberg News.
Second-quarter net income rose to 12.9 billion koruna from 6.74 billion koruna a year earlier, the Prague-based company said on Aug. 10, beating the 7.92 billion-koruna mean estimate of 14 analysts polled by Bloomberg. CEZ affirmed its 2012 plan for net income at 41 billion koruna and earnings before income, taxes, depreciation and amortization at 87.9 billion koruna.