Northeast Utilities Hits 52-Week High - Analyst Blog
April 15 2013 - 5:00AM
Zacks
On Apr 12, 2013, the shares of
Northeast Utilities (NU) climbed to its 52-week
high of $44.74 driven by its strong projects pipeline and
diversified asset base. We expect the company’s long-term earnings
growth to be 7.55%.
As announced in Feb 2013, Northeast Utilities intends to invest
around $1.6 billion in 2013 to upgrade the electricity and natural
gas infrastructure. Currently, the company is in the middle of
several major projects including Greater Springfield Reliability
Project, Interstate Reliability Project and Northern Pass Project.
These initiatives will enable the company to increase the
transmission capacity, which will subsequently help to meet the
rise in customers’ demand.
In Apr 2012, Northeast Utilities completed its merger with NSTAR
and enjoyed related benefits in fourth quarter 2012. Quarterly
revenues surpassed the prior-year results due to strong performance
by the transmission segment primarily backed by this merger. We
believe this merger will aid the company to increase its scale of
operations and serve a wider customer base in the future.
As of Dec 31, 2012, Northeast Utilities had $45.7 million in cash
and $1.45 billion available under its revolving credit facilities.
This financial position enables the company to pursue steady
inorganic as well as organic growth strategies.
Northeast Utilities expects a steady performance in 2013. The
company’s earnings guidance for full year 2013 is $2.40 to $2.60
per share. The Zacks Consensus Estimates for full year 2013 and
2014 is $2.55 and 2.71 per share, up 12.06% and 6.18% year over
year, respectively.
In Feb 2013, the board of directors of Northeast Utilities
increased its quarterly dividend by 7.1% to 36.75 cents per share.
The company has been boosting its investors’ income by hiking the
dividend payment consistently since 1966. The company’s practice of
raising dividends from time to time will benefit the stock as it
attracts investor attention.
Northeast Utilities currently has a Zacks Rank #2 (Buy). Besides
Northeast Utilities, other stocks from the industry that are
performing well include Brookfield Infrastructure Partners
L.P. (BIP), Empresa Nacional de Electricidad
S.A. (EOC) and Pike Electric Corporation
(PIKE). All the three stocks carry a Zacks Rank #1 (Strong
Buy).
BROOKFIELD INFR (BIP): Free Stock Analysis Report
ENDESA-CHILE (EOC): Free Stock Analysis Report
NORTHEAST UTIL (NU): Free Stock Analysis Report
PIKE ELECTRIC (PIKE): Free Stock Analysis Report
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