In a report released today, William Appicelli from UBS reiterated a Buy rating on Centerpoint Energy, with a price target of $44.00.
Elevate Your Investing Strategy:
- Take advantage of TipRanks Premium at 55% off! Unlock powerful investing tools, advanced data, and expert analyst insights to help you invest with confidence.
William Appicelli has given his Buy rating due to a combination of factors that suggest strong future growth for Centerpoint Energy. The company is expected to achieve an earnings per share (EPS) growth rate nearing 10% annually through the end of the decade, with a longer-term growth rate projected at 7-9%. This growth is supported by significant capital expenditure (capex) opportunities, estimated to add around $4 billion to the company’s plans by 2030, which could drive the rate base growth to approximately 13%.
Additionally, the anticipated sale of Ohio assets could provide $2.0-2.5 billion, potentially reducing the need for external equity funding. This financial maneuvering, along with the company’s strategic focus on expanding its operations in Texas, particularly at Houston Electric and the Texas Gas segment, positions Centerpoint Energy as an attractive investment. Despite some regulatory concerns in Indiana, these appear to be overstated, and the overall outlook for the company remains positive, with a valuation expected to approach a low single-digit premium by the end of the decade.
In another report released yesterday, Wolfe Research also maintained a Buy rating on the stock with a $43.00 price target.