Fortis (FTS), a North American power and gas utility company, announced Friday its third-quarter results and 2022-26 capital investment plan.
Revenue came in at C$2.2 billion in the third quarter, up from C$2.1 billion in the prior-year quarter.
Net earnings amounted to C$295 million (C$0.63 per share) in Q3 2021, up from C$292 million (C$0.63 per share) in Q3 2020.
On an adjusted basis, net earnings were C$300 million (C$0.64 per share), compared with C$302 million (C$0.65 per share) a year ago.
Fortis president and CEO David Hutchens said that the performance reflects the underlying growth at the company’s utilities, and the benefits of its regulatory and geographic diversity, offset by headwinds related to unfavorable foreign exchange and cooler weather in Arizona.
The company announced a new five-year C$20-billion capital plan, representing Fortis’ largest capital plan to date.
Hutchens said, “This highly executable plan will extend our robust rate base growth that will support the delivery of cleaner energy and advance our goal to reduce greenhouse gas emissions 75% by 2035.”
Fortis increased its common share dividend increase by approximately 6%, marking 48 years of consecutive increases. It reaffirmed its 6% average annual dividend growth guidance through 2025. (See Insiders’ Hot Stocks on TipRanks)
On October 21, CIBC analyst Mark Jarvi maintained a Hold rating on FTS, while lowering its price target to C$58 (from C$59). This implies 5.6% upside potential.
Overall, consensus among Wall Street analysts is that FTS is a Hold based on one Buy, seven Holds, and one Sell. The average Fortis price target of C$61.55 implies 12% upside potential to current levels.
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