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Pinnacle West Capital
(NYSE:PNW)
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Rating:56Neutral
Price Target:
$96.00
â–¼(-2.73% Downside)
Action:Reiterated
Date:10/01/26
PNW scores mid-range primarily due to constrained financial flexibility—high leverage and persistently negative free cash flow outweigh otherwise stable utility earnings. Technical signals are also weak (below major moving averages with negative MACD and low RSI/Stoch), limiting near-term momentum. These risks are partially offset by reasonable valuation/income (moderate P/E and ~3.9% yield) and a constructive earnings outlook with reiterated guidance and strong demand/load-growth indicators.
Positive Factors
Stable regulated earnings base
APS operates under regulated tariffs designed to recover prudent costs and provide an allowed return on invested capital. That framework, combined with rising revenue and stable margins, supports recurring earnings visibility and a durable foundation for funding essential grid investment.
Negative Factors
Elevated and rising leverage
The higher debt burden reduces financial flexibility as Pinnacle West pursues substantial infrastructure investment. Leverage also increases sensitivity to interest costs and financing conditions, making it harder to absorb earnings pressure or fund expansion without additional debt or equity.
Read all positive and negative factors
Positive Factors
Negative Factors
Stable regulated earnings base
APS operates under regulated tariffs designed to recover prudent costs and provide an allowed return on invested capital. That framework, combined with rising revenue and stable margins, supports recurring earnings visibility and a durable foundation for funding essential grid investment.
Read all positive factors
Pinnacle West Capital Key Performance Indicators (KPIs)
Any
Revenue by Segment
Highlights revenue from different business units, providing insight into which segments are driving growth and which may need strategic adjustments. This helps assess the company's diversification and resilience against market fluctuations.
Highlights revenue from different business units, providing insight into which segments are driving growth and which may need strategic adjustments. This helps assess the company's diversification and resilience against market fluctuations.
Data provided by:
The Fly
The FlyPinnacle West Capital (PNW) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$11.32B
Dividend Yield3.91%
Average Volume (3M)984.51K
Price to Earnings (P/E)17.5
Beta (1Y)0.16
Revenue Growth5.69%
EPS Growth6.83%
CountryUS
Employees6,610
SectorUtilities
Sector Strength65
IndustryRegulated Electric
Share Statistics
EPS (TTM)5.32
Shares Outstanding121,197,235
10 Day Avg. Volume1,216,744
30 Day Avg. Volume984,508
Financial Highlights & Ratios
PEG Ratio-4.61
Price to Book (P/B)1.51
Price to Sales (P/S)1.99
P/FCF Ratio-12.95
Enterprise Value/Market Cap<0.01
Enterprise Value/Revenue<0.01
Enterprise Value/Gross Profit<0.01
Enterprise Value/Ebitda<0.01
Forecast
1Y Price Target
$103.25Price Target Upside4.62% Upside
Rating ConsensusHold
Number of Analyst Covering8
EPS Forecast (FY)4.72
Revenue Forecast (FY)$5.49B
Pinnacle West Capital Business Overview & Revenue Model
Company Description
Pinnacle West Capital Corporation (PNW), primarily operating through its Arizona Public Service Company (APS) subsidiary, delivers retail and wholesale electricity services predominantly within Arizona. The company manages the full scope of electr...
How the Company Makes Money
Pinnacle West makes most of its money through APS’s regulated electric utility business. APS earns revenue by selling electricity service to customers under state-regulated tariffs, which include charges tied to energy usage (kWh) and, for some cu...
Pinnacle West Capital Earnings Call Summary
Earnings Call Date:Aug 04, 2026
(Q2-2026)
| % Change Since: |
Next Earnings Date:Oct 30, 2026
Earnings Call Sentiment Positive
The call emphasized substantial and diversified load growth (weather-normalized sales +9.6%, C&I +12.7%), large economic catalysts (TSMC incremental $100B), record demand, and continued investments in generation and transmission with constructive financing actions and reiterated full-year guidance (expecting to finish at top end of $4.55–$4.75). Offsetting these positives were near-term earnings pressures from higher interest and depreciation, a Q2 EPS decline of $0.15, a transmission true-up timing impact, and additional capital and gas supply execution risks (e.g., Cholla conversion and pipeline development). Overall the growth drivers, strategic investments, strong customer metrics and maintained guidance materially outweigh the near-term financial and execution headwinds.Positive Updates
Strong Sales and Customer Growth
Weather-normalized sales growth of 9.6% year-over-year in Q2; customer growth of 2.1% contributed approximately $0.11 to quarter-over-quarter earnings; residential sales growth of 5.6% and commercial & industrial (C&I) sales growth of 12.7% driven by data center and advanced manufacturing expansion.
Negative Updates
Quarterly EPS Decline and Key Earnings Headwinds
Reported Q2 EPS of $1.43, a decrease of $0.15 versus Q2 2025; primary negative drivers were higher interest net of AFUDC, higher depreciation & amortization from increased plant balances, and lower transmission revenue (timing/true-up).
Read all updates
Q2-2026 Updates
Positive
Negative
Strong Sales and Customer Growth
Weather-normalized sales growth of 9.6% year-over-year in Q2; customer growth of 2.1% contributed approximately $0.11 to quarter-over-quarter earnings; residential sales growth of 5.6% and commercial & industrial (C&I) sales growth of 12.7% driven by data center and advanced manufacturing expansion.
Read all positive updates
Company Guidance
The company reiterated its 2026 guidance and said it currently expects to finish the year at the top end of its earnings range of $4.55–$4.75 per share; Q2 EPS was $1.43 (down $0.15 vs. Q2 2025), with customer and sales growth contributing about $0.11 of the quarter‑over‑quarter benefit. Operational metrics driving guidance included 2.1% customer growth, Q2 weather‑normalized sales growth of 9.6% (residential +5.6%, commercial & industrial +12.7%), and a new all‑time peak demand of 9,164 MW (≈500 MW above last year); management is not updating 2026 sales guidance now but cites a longer‑term sales target of 5%–7% through 2030 (vs. 4%–6% for this year and 4%–6% for large C&I). Financing and capital notes to the outlook: the company issued $500M of senior unsecured notes, exhausted its $900M ATM capacity and filed a new $500M ATM, is not changing near‑term CapEx guidance (the recently announced Cholla conversion—expected to add ≈380 MW by 2029—could add up to ~$440M of incremental capital mostly in 2027–2028), and expects a final rate decision before year‑end.Pinnacle West Capital Financial Statement Overview
Summary
Income Statement
74
Positive
Balance Sheet
56
Neutral
Cash Flow
40
Negative
| Breakdown | TTM | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 5.55B | 5.34B | 5.12B | 4.70B | 4.32B | 3.80B |
| Gross Profit | 3.08B | 1.36B | 2.14B | 1.84B | 1.71B | 1.70B |
| EBITDA | 2.19B | 2.13B | 2.07B | 1.78B | 1.65B | 1.70B |
| Net Income | 640.11M | 616.53M | 608.81M | 501.56M | 483.60M | 618.72M |
Balance Sheet | ||||||
| Total Assets | 32.58B | 31.68B | 26.10B | 24.66B | 22.72B | 22.00B |
| Cash, Cash Equivalents and Short-Term Investments | 9.12M | 9.85M | 3.84M | 4.96M | 4.83M | 9.97M |
| Total Debt | 11.37B | 17.85B | 11.05B | 10.30B | 8.88B | 8.18B |
| Total Liabilities | 25.50B | 24.60B | 19.25B | 18.38B | 16.56B | 15.98B |
| Stockholders Equity | 7.03B | 7.05B | 6.75B | 6.18B | 6.05B | 5.91B |
Cash Flow | ||||||
| Free Cash Flow | -878.54M | -819.52M | -639.37M | -638.67M | -466.05M | -613.46M |
| Operating Cash Flow | 1.77B | 1.81B | 1.61B | 1.21B | 1.24B | 860.01M |
| Investing Cash Flow | -2.52B | -2.58B | -1.93B | -1.69B | -1.62B | -1.39B |
| Financing Cash Flow | 743.63M | 775.09M | 322.69M | 486.68M | 371.47M | 476.92M |
Pinnacle West Capital Technical Analysis
Negative
98.69
Price Trends
98.19
Negative
100.47
Negative
97.73
Negative
Market Momentum
-1.81
Positive
38.07
Neutral
43.84
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For PNW, the sentiment is Negative. The current price of 98.69 is above the 20-day moving average (MA) of 94.75, above the 50-day MA of 98.19, and above the 200-day MA of 97.73, indicating a bearish trend. The MACD of -1.81 indicates Positive momentum. The RSI at 38.07 is Neutral, neither overbought nor oversold. The STOCH value of 43.84 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for PNW.
Pinnacle West Capital Risk Analysis
Pinnacle West Capital disclosed 28 risk factors in its most recent earnings report. Pinnacle West Capital reported the most risks in the "Legal & Regulatory" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Pinnacle West Capital Peers Comparison
UnderperformOutperform
Sector (66)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
67 Neutral | $9.37B | 19.83 | 9.56% | 3.74% | 0.63% | -6.14% | |
66 Neutral | $17.65B | 18.10 | 5.60% | 3.62% | 6.62% | 11.55% | |
60 Neutral | $7.58B | 21.15 | 9.36% | 2.69% | -1.11% | 8.18% | |
60 Neutral | $18.15B | 19.51 | 9.06% | 3.54% | 3.60% | 10.06% | |
58 Neutral | $16.68B | 19.97 | 11.04% | 3.34% | 6.83% | -2.08% | |
56 Neutral | $11.32B | 17.50 | 9.04% | 3.91% | 5.69% | 6.83% | |
52 Neutral | $6.44B | 32.34 | 5.67% | 2.87% | 9.97% | -7.29% |
* Utilities Sector Average
PNW
Pinnacle West Capital
93.04
8.15
9.60%
LNT
Alliant Energy
63.30
-1.78
-2.74%
IDA
IdaCorp
130.73
2.56
2.00%
OGE
OGE Energy
45.42
1.36
3.08%
TXNM
TXNM Energy
58.32
3.16
5.74%
EVRG
Evergy
78.44
4.78
6.49%
Pinnacle West Capital Corporate Events
Business Operations and StrategyShareholder Meetings
Pinnacle West highlights Arizona growth in upcoming meetings
Positive
Sep 30, 2026
Pinnacle West Capital, through its principal subsidiary Arizona Public Service, operates Arizona’s largest electric utility, serving 1.4 million customers with 6.3 GW of owned or leased generating capacity and consolidated assets of $30 bill...
Business Operations and StrategyFinancial Disclosures
Pinnacle West Highlights Strong Utility Growth and Demand
Positive
Sep 4, 2026
In September 2026, Pinnacle West Capital prepared investor materials highlighting the robust fundamentals of its Arizona electric utility business and the strength of its service territory. The company underscored that Phoenix and Maricopa County&...
Business Operations and StrategyFinancial Disclosures
Pinnacle West Raises Long-Term Sales Growth Outlook
Positive
Aug 7, 2026
Pinnacle West Capital is leveraging its position as Arizona’s largest electric utility, with 1.4 million customers, $30 billion in assets, 6.3 GW of capacity, and a 58% clean-energy mix as of Dec. 31, 2025, to serve a rapidly expanding custo...
Business Operations and StrategyPrivate Placements and Financing
Pinnacle West Capital Announces $500 Million Equity Program
Positive
Aug 4, 2026
On August 4, 2026, Pinnacle West Capital entered into an Equity Distribution Agreement with a syndicate of major banks and broker-dealers to offer and sell up to $500 million of its common stock through at-the-market and other types of equity tran...
Business Operations and StrategyFinancial Disclosures
Pinnacle West Capital Reports Lower Quarterly Earnings
Negative
Aug 4, 2026
Pinnacle West Capital reported that consolidated net income attributable to common shareholders for the quarter ended June 30, 2026 declined to $178.6 million, or $1.43 per diluted share, from $192.6 million, or $1.58 per diluted share, in the sam...
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.