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On Thursday, Barclays (LON:BARC) analyst Nicholas Campanella revised the price target for OGE Energy (NYSE:OGE), an $8.54 billion utility company with a solid GOOD Financial Health Score according to InvestingPro, reducing it to $42.00 from the previous target of $43.00. Despite the price target adjustment, the analyst maintained an Equalweight rating on the stock.
Campanella's report anticipates OGE Energy's earnings announcement scheduled for February 19, before the market opens. The company, which has maintained dividend payments for 55 consecutive years and currently offers a 3.96% yield, is expected to update its five-year financial plan through 2029, reaffirm its long-term earnings per share (EPS) compound annual growth rate (CAGR) of 5-7%, and provide guidance for full-year 2025. Barclays has set its own 2025 EPS estimate at $2.28, which is slightly above the consensus estimate of $2.27.
The analyst's forecast includes a year-over-year growth of 7.5% for the 2025 EPS, largely attributed to the benefits of load growth. OGE Energy has seen an uptick in its long-term range due to stronger commercial and industrial load prospects. However, despite potential for economic development in OGE's service area, management is expected to maintain a conservative stance in its full-year update. This includes a standard capital expenditure increase and the continuation of the 5-7% long-term EPS growth, likely at the higher end of that range.
For investors seeking deeper insights, InvestingPro offers extensive analysis and additional ProTips for OGE Energy, including detailed valuation metrics and growth forecasts.OGE Energy's shares are currently trading at a P/E ratio of 22.17x, representing a 17.5% premium compared to its small to mid-size (SMID) peers. Based on InvestingPro's Fair Value analysis, the stock appears to be slightly overvalued at current levels. With the new price target of $42 per share, Barclays reaffirms its neutral stance on OGE Energy's stock.
In other recent news, OGE Energy Corp. has been the focus of several significant developments. The company's strong Q3 2024 results showcased consolidated earnings of $1.09 per share, despite a decrease in net income due to higher expenses. OGE Energy's management is optimistic about meeting the upper end of its earnings guidance for the year, which ranges from $2.06 to $2.18 per share. This optimism is backed by a significant year-to-date load growth of 6.8%, with a forecast of 4% to 6% for the full year.
In addition, Evercore ISI analyst Durgesh Chopra recently upgraded OGE Energy's stock rating from In Line to Outperform, with a new price target of $47.00. This upgrade is supported by the company's projected 7% earnings per share (EPS) growth through 2027 and a robust financial position. OGE Energy's financial strength is further evidenced by its impressive 55-year streak of maintaining dividend payments, with 18 consecutive years of dividend increases.
OGE Energy has also made significant strides in its corporate structure, recently appointing Charles Walworth as its new Chief Financial Officer and Treasurer. Furthermore, the company's Board of Directors declared a quarterly dividend of $0.42125 per common share. These recent developments highlight OGE Energy's commitment to growth, efficiency, and responsible management of customer and shareholder interests.
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