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Investing.com - BofA Securities upgraded Black Hills Corp (NYSE:BKH) from Underperform to Neutral and raised its price target to $64.00 from $57.00. The stock, currently trading at $60.87, has shown resilience with a 10.67% return over the past year and maintains a strong dividend tradition, having raised its dividend for 54 consecutive years.
The upgrade follows the announcement of an all-stock merger between Black Hills Corp and NorthWestern Energy (NYSE:NWE) valued at $15.4 billion.
Under the merger terms, NorthWestern Energy shareholders will receive 0.98 shares of Black Hills for each share owned, resulting in Black Hills shareholders owning 56% of the combined company and NorthWestern Energy shareholders owning 44%.
The combined entity will be led by NorthWestern Energy’s Brian Bird as CEO, with Black Hills’ Marne Jones as COO and NorthWestern’s Crystal Lail as CFO, while Black Hills’ Steve Mills will serve as Chairman.
BofA Securities analyst Julien Dumoulin-Smith noted that "the strategic positioning and fundamental outlook for the combined company represents a potential improvement over the standalone BKH entity," adding that no equity issuance is required to finance the transaction.
In other recent news, Black Hills Corporation reported its Q2 2025 earnings, meeting expectations for earnings per share and surpassing revenue forecasts. The company achieved an EPS of $0.38, aligning with projections, while revenue reached $439 million, exceeding the anticipated $412.68 million. Additionally, Black Hills Corp. and NorthWestern Energy Group announced a significant merger, creating a regional regulated utility with a combined enterprise value of $15.4 billion. This all-stock, tax-free merger will see NorthWestern shareholders receiving 0.98 shares of Black Hills for each NorthWestern share, representing a 4% premium based on recent prices. Upon completion, Black Hills shareholders will hold approximately 56% of the new entity, with NorthWestern shareholders owning the remaining 44%. The merger has been unanimously approved by the boards of both companies. These recent developments highlight significant strategic moves and financial performance for Black Hills Corp.
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