AES Downgraded to ‘Equal Weight’ Following Takeover Agreement

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Morgan Stanley downgraded The AES Corporation (NYSE:AES) to ‘Equal Weight’ from ‘Overweight’ and trimmed its price target to $15 from $23, following the company’s agreement to be acquired for $15 per share. The downgrade reflects that AES is trading below the deal price, indicating low investor expectation of a competing bid. While a bull case of $18 is possible if another bidder emerges, Morgan Stanley suggests other AI stocks may offer higher returns.

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