American Electric price target raised to $109 from $105 at BMO Capital

BMO Capital raised the firm’s price target on American Electric to $109 from $105 and keeps an Outperform rating on the shares. PeakLoad published an article last week reporting that the company had hired bankers in preparation for the potential sale of a minority stake in its Transcos in Ohio/Indiana/Michigan, and while the key to any transaction will be the concession price and its impact on earnings and credit metrics, the firm views the initiative positively even if it is modestly EPS dilutive, the analyst tells investors in a research note. BMO adds that the initiative could remove a substantial portion of the company’s current equity financing program, which would be multiple accretive and remove a major overhang to the investment story, the firm stated.