Proactive Investors - Centrica (LON:CNA) looks cheap, reckons Swiss bank UBS, which has upgraded the British Gas owner to buy.
Worries over where capital will be deployed and a lack of visibility in its trading business are more than reflected in the current share price, said the bank.
Nuclear (Sizewell C) is one option, but even with this UBS sees scope for another £250 million buyback to be announced in the second half of this year.
Excess capital (cash) amounts to £1.75 billion (35p per share), stripping this out the enterprise value ratio is 3.5 times but a multiple of five is more appropriate says the bank, with seven even possible over time.
UBS has raised its price target to 170p from 165p on higher cash flow generation and lower decommissioning provisions.
Shares rose 1.4% to 133p.