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    What APA Group (ASX:APA)'s Brigalow Peaking Power Deal With CS Energy Means For Shareholders

    Simply Wall St·12/10/2025 03:23:34
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    • In late November 2025, APA Group announced a special call to discuss its Joint Development Agreement with CS Energy to develop and own the proposed Brigalow Peaking Power Plant.
    • This collaboration highlights APA Group’s push further into peaking power generation, potentially enhancing its role in supporting grid reliability alongside renewables.
    • We’ll now explore how the Brigalow peaking power partnership with CS Energy may reshape APA Group’s existing investment narrative and risk profile.

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    APA Group Investment Narrative Recap

    To back APA Group today, you generally need to believe that long term demand for gas infrastructure and related power assets will offset transition and regulatory headwinds. The Brigalow Peaking Power Plant agreement fits that thesis by leaning into gas peakers that support renewables, but it does not fundamentally change the near term earnings and balance sheet pressure that remains the key catalyst and the most important risk to watch.

    Among recent announcements, the FY2025 result stands out in this context, with revenue of A$3,204.0 million but net income of only A$99.0 million and a high price to earnings multiple. Brigalow sits alongside this weaker profitability picture, reinforcing the importance of how APA funds and executes new capital intensive projects at a time when profit margins and interest cover are already under strain.

    Yet while Brigalow speaks to growth, investors also need to be aware of the risk that APA’s ongoing heavy capital expenditure obligations could...

    Read the full narrative on APA Group (it's free!)

    APA Group's narrative projects A$3.7 billion revenue and A$385.1 million earnings by 2028. This requires 4.5% yearly revenue growth and about a A$286 million earnings increase from A$99.0 million today.

    Uncover how APA Group's forecasts yield a A$8.72 fair value, a 4% downside to its current price.

    Exploring Other Perspectives

    ASX:APA 1-Year Stock Price Chart
    ASX:APA 1-Year Stock Price Chart

    Six Simply Wall St Community fair value estimates for APA Group range from A$6.13 to about A$21.58, showing very different views on upside. Set these against APA’s need for substantial, ongoing capital expenditure and you can see why it pays to weigh several perspectives on how future projects might affect returns and balance sheet flexibility.

    Explore 6 other fair value estimates on APA Group - why the stock might be worth 33% less than the current price!

    Build Your Own APA Group Narrative

    Disagree with existing narratives? Create your own in under 3 minutes - extraordinary investment returns rarely come from following the herd.

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    This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.