BUZZ-Drax: broker upgrades after hefty price fall

** Beaten-down power station Drax recovers some poise as Societe Generale (Paris: FR0000130809 - news) upgrades rating on stock to "hold" vs "sell" on valuation grounds ahead of H1 results on July 28

** SocGen flags YTD Drax has been worst performer on Euro Stoxx 600 (-45% or -67% vs March 2014 peak) & now trades below broker's fair value target; cuts TP to 270p vs 400p

** SocGen forecasts H1 EBITDA of £90m (vs £102m in 2014), EPS of 6.8p (vs 9.4p) and DPS of 3.4p (vs 4.7p)

** Says in absence of greater regulatory clarity, stock not an outright buy

** Drax, which is generating a growing amount of energy from biomass pellets, slid 28% OTD early July when UK finmin George Osborne said renewable energy suppliers & their customers would no longer be exempt from a climate change tax

** Stock still trading close to levels reached that day (record low); but on Monday up 0.9% & among top FTSE 250 risers

** Alastair Mundy, manager of Investec UK Special Situations Fund, bought more Drax shares the day after co lost the tax exemption -- partly on basis decision could be reversed (Osborne been forced to retreat on proposed taxes before) (RM (LSE: RM.L - news) : tricia.wright1.thomsonreuters.com@reuters.net)