On Oct 13, Zacks Investment Research upgraded Edison International EIX to a Zacks Rank #1 (Strong Buy).
Why the Upgrade?
Edison International has been witnessing rising earnings estimates on the back of steady performances in the last few quarters. This electric utility delivered positive earnings surprises in the last four quarters with an average beat of 23.7%. The long-term expected earnings growth rate for this stock is 4.68%.
Edison International reported second-quarter 2015 results wherein its adjusted earnings of $1.15 per share came in ahead of the Zacks Consensus Estimate of $0.81 by 42%. The quarterly number grew 7.4% from $1.08 a year ago.
Edison International through its primary subsidiary Southern California Edison (SCE) will invest $11.5–$13.1 billion between 2015 and 2017, including an allocation of $3.6–$4.1 billion for 2015. The company’s capital investment plan primarily focuses on expanding distribution (with a capex forecast of up to $3.1 billion in 2015) and transmission (with a capex forecast of up to $0.8 billion in 2015) facilities, replacement of infrastructure and investment to improve reliability as well as energy storage capacity.
Given the supportive regulatory environment in California, SCE expects 7–9% average annual rate base growth and earnings growth driven by systematic investments in infrastructure projects in the 2015-2017 time period.
The Zacks Consensus Estimate for 2015 increased 2.5% to $3.78 per share in the last 60 days as 2 out of 7 analysts revised their estimates upward.
Other Stocks to Consider
In addition to Edison International, investors can consider Brookfield Infrastructure Partners L.P. BIP, Consolidated Edison, Inc. ED and IdaCorp, Inc. IDA. All these utilities currently sport a Zacks Rank #1(Strong Buy).
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