Zacks Investment Research downgraded shares of DTE Energy Company (DTE) from OUTPERFORM to NEUTRAL on October 01, 2012, with a target price of $63.00.
Our mildly bullish outlook for DTE Energy is supported by its stable and growing utilities and its complementary non-utility businesses. Going forward, the growth momentum will be maintained by beneficial regulatory policies in Michigan, higher authorized rates for its regulated business, growth opportunities in its un-regulated businesses and an industry-high dividend yield. There are also plans to monetize its Barnett Shale assets and other properties, which would alleviate the need for external borrowings. However, we believe these factors are already priced in the current valuation, leaving little room for upside. Also, valuation continues to be restrained by the present unfavorable macro backdrop, lower demand for electricity, the dismal economy in Michigan state and pending regulatory cases.
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