UPDATE: Barclays Capital Upgrades Xcel Energy On Expected Rate Case Outcome

In a report published Tuesday, Barclays Capital analyst Daniel Ford upgraded the rating on Xcel Energy Inc. (NYSE: XEL) from Equal-Weight to Overweight, but lowered the price target from $41.00 to $39.00.

In the report, Barclays Capital noted, "We are upgrading the shares of XEL to Overweight in expectation of a constructive outcome to Northern States Power-MN's (NSP-MN) multi-year electric rate case. Resolution of this rate case should remove a long-standing overhang from the stock and largely clear the regulatory calendar for XEL. Our $39 price target is predicated on XEL moving up to a 10% premium to the 2017 regulated utility industry average P/E multiple from its current 4% discount. Taking the price appreciation in conjunction with the implied dividend yield of 3.3%, results in total return potential of roughly 15%."

Xcel Energy closed on Monday at $35.00.