Talen Energy initiated with a Buy at Guggenheim

Guggenheim analyst Shahriar Pourreza initiated coverage of Talen Energy (TLN) with a Buy rating and $169 price target. Ahead of an investor day in NYC tomorrow, the firm contends that Talen “represents an attractive PJM pure-play opportunity,” with a core asset in the Susquehanna nuclear facility augmented by a portfolio of capacity payment harvesting fossil assets that present a “differentiated opportunity for investors to gain direct exposure to a platform that is levered not only to the favorable resource adequacy backdrop in PJM, but also ongoing data center growth.” Talen’s “unique” existing hyperscaler relationship with AWS (AMZN) provides “a potential beachhead to further collaboration on a theme that has propelled the sector to fresh valuations year to date,” the analyst tells investors.