It's been a big year for AGL Energy Limited (ASX: AGL), culminating in the appointment of four divisive directors last month. But two of those directors appear to see value in the AGL share price, each snapping up thousands of the energy provider's stock last week.
Fortunately, the AGL share price has far from suffered in 2022. It has gained 23% year to date to trade at $7.80 at the time of writing.
With two directors buying the S&P/ASX 200 Index (ASX: XJO) stock, should market watchers put AGL on their December wish list? Let's take a look.
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Insiders snap up AGL stock
AGL insiders have been on a buying streak in recent sessions. Two newly appointed directors have forked out a total of around $200,000 on their company's shares.
Mike Cannon-Brookes' nominations Kerry Schott and Christine Holman were behind the buying.
Schott indirectly snapped up 12,000 AGL shares for around $8.16 apiece on Friday. Meanwhile, Holman indirectly bought 13,000 shares for $8.09 apiece.
Unfortunately for the insiders, the AGL share price has since slumped amid broader market concerns. It hit a low of $7.44 in intraday trade yesterday.
Is now a good time to consider buying AGL shares?
That might suggest the S&P/ASX 200 Utilities Index (ASX: XUJ) staple is trading at a reasonable price. Insider buying is often considered a sign those in the know are confident a stock is a good investment.
However, there are a number of factors I believe one should consider when looking at AGL shares.
The first is the Australian Government's plan to temporarily cap gas at $12 per gigajoule. The move has been slammed by industry groups who claim it could harm the Aussie gas market, my Fool colleague Bernd reports.
Another factor potentially worth considering is the company's plan to ditch coal-fired power. It recently brought forward its expected coal exit to 2036 and flagged $20 billion of investment is required to meet its goal.
Meanwhile, the company tips its earnings to grow substantially in financial year 2023.
It's predicting it will post between $1.25 billion and $1.45 billion of underlying earnings before interest, tax, depreciation, and amortisation (EBITDA) this fiscal year. That's a potential $100 million year-on-year increase.
Whether higher earnings will translate to greater dividends as the company looks to a greener future is unclear, as The Motley Fool Australia's Tristan recently outlined.
Turning to brokers, both Morgans and Credit Suisse were bullish on AGL shares back in October. They slapped the stock with respective price targets of $8.81 and $8.20.
Meanwhile, Macquarie recently turned to defensive sectors such as utilities amid concerns a market contraction in the new year could hamper companies with more volatile earnings, the Australian Financial Review reports.
