Estimates for Pinnacle West Capital Corporation PNW have been revised upward in the past 90 days, reflecting analysts’ optimism in the stock. The Zacks Consensus Estimate for 2019 earnings have moved up 2.5%.
Shares of Pinnacle West Capital have improved 2.5% in the past 12 months compared with the industry’s rise of 0.1%.
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Let’s focus on the factors that make Pinnacle West Capital an attractive stock to invest in.
Zacks Rank & Surprise History
The company currently carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Pinnacle West Capital pulled off an average positive earnings surprise of 6.15% in the last four quarters.
Growth Projections
The Zacks Consensus Estimate for 2019 earnings per share is pegged at $4.84, reflecting year-over-year improvement of 8.14%. Its long-term earnings growth rate (3 to 5 years) is at 4.47%.
The Zacks Consensus Estimate for 2019 revenues is pegged at $3.67 billion, reflecting year-over-year rise of nearly 2.20%.
VGM Score
Pinnacle West Capital has an impressive VGM Score of B. Here V stands for Value, G for Growth and M for Momentum with the score being a weighted combination of all three factors. Back tested results show that stocks with a favorable VGM Score of A or B coupled with a bullish Zacks Rank are the best investment options.
Systematic Investments & Customer Growth
Pinnacle West Capital’s constant investments in traditional generation, transmission and distribution lines will enable it to serve customers efficiently. Approximately 200 miles of transmission lines and 15 new substations are supporting the additional capacity, which have been added in the past three years. The company projects capital expenditure of $1,153 million and $1,211 million for 2019 and 2020, respectively.
Pinnacle West’s subsidiary, Arizona Public Service (APS), is the largest and longest-serving electric utility provider in Arizona.The state is witnessing a gradual economic recovery, courtesy of rapid development in the Phoenix Metropolitan Area that continues to project job growth above the national average. This has led to growth in demand for utility services from the commercial and residential sectors.APS expects annual customer growth in the range of 2-3% over the 2018-2020 time frame.
Other Stocks to Consider
A few other top-ranked stocks from the same industry are Ameren Corporation AEE, IDACORP, Inc IDA and FirstEnergy Corp FE. WhileIDACORP sports a Zacks Rank #1, Ameren and FirstEnergy hold a Zacks Rank #2.
Long-term earnings growth of Ameren, IDACORP and FirstEnergy is pegged at 6.80%, 2.80% and 6%, respectively.
The Zacks Consensus Estimate for 2019 earnings of Ameren, IDACORP and FirstEnergy inched up 0.3%, 1.1% and 1.2% respectively, in the past 90 days.
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