Mizuho has updated its outlook on Alliant Energy (NASDAQ: NASDAQ:LNT), increasing the price target to $61 from the previous $52 while maintaining a Neutral rating on the stock.
The adjustment follows the recent approval of a rate case settlement for Alliant's subsidiary, Interstate Power and Light (IPL), in Iowa.
The firm is looking ahead to a significant autumn full of updates for Alliant Energy, particularly focusing on the third-quarter earnings call for 2024.
Expectations are set for Alliant to provide an updated load growth outlook, a roll forward of capital expenditure (capex) and financing plans, and to announce the 2025 earnings per share (EPS) guidance.
Mizuho noted Alliant Management's increasingly optimistic perspective on load growth within their service areas. The market is awaiting further details from the forthcoming updates, which are anticipated to shed more light on the company's financial trajectory.
The revised price target of $61 reflects current market multiples. The firm reiterated its Neutral rating, suggesting that the shares are currently trading at a fair value, factoring in a mid-single digit price-to-earnings (P/E) premium. T
In other recent news, Alliant Energy Corporation announced a public offering of senior debentures totaling $650 million, with the proceeds intended to retire existing debts and for general corporate purposes.
The offering involved notable underwriters such as Barclays Capital Inc., Goldman Sachs & Co. LLC, and J.P. Morgan Securities LLC. Simultaneously, Ladenburg Thalmann upgraded Alliant Energy's stock from Neutral to Buy, citing potential earnings upside from an Iowa settlement. This agreement, pending approval, allows Alliant Energy's subsidiary, Interstate Power, to retain revenues and tax credits from AI/data center load for the next five years.
In its Q2 earnings report, Alliant Energy reported an EPS of $0.57, falling short of the projected $0.67 and $0.64 by BMO Capital and the broader analyst consensus. Despite this, the company confirmed its full-year EPS guidance for 2024, projecting a range between $2.99 and $3.13. The company also reported a decrease in adjusted operations and maintenance expenses by $20 million compared to the previous year, and an increase in cash flows from operations by approximately $250 million.
BMO Capital Markets revised its outlook on Alliant Energy, raising the stock price target from $58.00 to $60.00, maintaining a Market Perform rating.
InvestingPro Insights
Alliant Energy's recent performance and financial metrics align well with Mizuho's updated outlook. According to InvestingPro data, the company's stock is trading near its 52-week high, with a strong return of 20.24% over the last three months. This upward trend supports Mizuho's decision to raise the price target.
InvestingPro Tips highlight Alliant Energy's consistent dividend history, having maintained dividend payments for 54 consecutive years and raised them for 20 consecutive years. This track record of stable returns to shareholders underscores the company's financial stability, which is likely a factor in Mizuho's Neutral rating.
The company's P/E ratio of 24.72 suggests investors are willing to pay a premium for Alliant's earnings, possibly due to its consistent performance and dividend policy. With a dividend yield of 3.17%, Alliant Energy continues to be an attractive option for income-focused investors.
For readers interested in a more comprehensive analysis, InvestingPro offers 8 additional tips for Alliant Energy, providing deeper insights into the company's financial health and market position.
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