On Jan 2, 2015, Zacks Investment Research upgraded PG&E Corporation (PCG) to a Zacks Rank #1 (Strong Buy).
Why the Upgrade?
San Francisco-based PG&E Corporation has a solid base of regulated utility asset mix that offers a stable earnings base. Timely rate relief from regulatory authorities helps the company to boost shareholder value and provide reliable services to its customers.
PG&E continues to make considerable progress on gas related commitments as well as on its targeted electric system safety and reliability programs. In Oct 2014, the company opened an electric distribution control center in Fresno worth $28.5 million. PG&E also intends to open two additional facilities at Concord and Rocklin. These three facilities will support the company’s 140,000 miles of electric distribution system serving around 16 million residents of California.
Moreover, this electric utility provider has already replaced conventional meters with smart meters at its electric utility systems. The company plans to spend $15.8–$16.5 billion between 2014 and 2016 and projects a CAGR of 9% for the same period.
The company’s third-quarter results were impressive with earnings outpacing the Zacks Consensus Estimate by 50.4% and soaring 96.6% year over year. The company’s quarterly revenues also increased 18.3% from the prior year and surpassed the Zacks Consensus Estimate by 1.4%.
The Zacks Consensus Estimate for 2014 and 2015 saw an upside as few estimates moved north in the last 90 days. It moved up 13.5% to $3.45 for 2014 and 9.8% to $3.47 for 2015.
Other Stocks to Consider
Apart from PG&E Corporation, other stocks doing well from a Zacks Rank perspective in the same industry include Black Hills Corp. (BKH), also sporting a Zacks Rank #1 and Ameren Corp. (AEE) and Alliant Energy Corp. (LNT), holding a Zacks Rank #2 (Buy).
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