J.P. Morgan Initiates Xcel Energy With Neutral Rating (XEL)
J.P. Morgan is out with a research report this morning, where it initiates a Neutral rating on Xcel Energy (NYSE: XEL); it has a $23.00 price target on the stock.
The JPM analysts said that the company generates stable, predictable 5-7% annual EPS growth, given Xcel’s pure play regulated utilities operate in jurisdictions with constructive regulation which helps ensure timely recovery of its investments through rider and forward test-year mechanisms.
As a result, the analysts believe the company deserves a modest premium for predictability, but believe this is offset by a yield below the low end of its peer group range of 5-6.5%. The shares trade in line with its peers’. Thus, the JPM analysts are initiating coverage with a Neutral rating.
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