BofA Upgrades DTE Energy After Beat, Says Company Has Among Best Earnings Growth In Sector

Zinger Key Points
  • BofA Securities analyst has upgraded the rating for DTE Energy from Underperform to Buy, while raising the price target from $111 to $127.
  • DTE management expects earnings growth in the 5-7% range looking ahead, consistent with BofA estimates of a 6-8% target range.

DTE Energy Co DTE reported its fiscal 2021 results ahead of expectations, raised its 2022 earnings guidance range and provided a “strong affirmation of the long-term growth trajectory,” according to BofA Securities.

The DTE Energy Analyst: Julien Dumoulin-Smith upgraded the rating for DTE Energy from Underperform to Buy, while raising the price target from $111 to $127.

The DTE Energy Thesis: The company has among the best earnings growth in the sector, Dumoulin-Smith said in the upgrade note.

“Mgmt. framed its expectations as near the upper-end of its existing 5-7% range looking ahead, consistent with our estimates – accordingly we see a move to a 6-8% target range as likely following the refresh of DTE’s 5-year capital plan and outlook expected during the Q3 / Edison Electric Institute (EEI) conference in November,” the analyst wrote.

“If this catalyst materializes, this would formally elevate DTE to be one of the few regulated utility companies with a 7% CAGR midpoint, garnering a premium valuation despite lingering business mix concerns,” he added.

DTE Price Action: Shares of DTE Energy had risen by 0.77% to $116.98 at the time of publication Tuesday.

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Photo: Courtesy of Diverse Stock Photos on Flickr

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