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Investing.com - Jefferies raised its price target on Eversource Energy (NYSE:ES) to $60.00 from $54.00 on Wednesday, while maintaining its Underperform rating on the utility company’s stock. The company, currently trading at $73.21 and near its 52-week high of $74.45, appears overvalued according to InvestingPro analysis.
The research firm expressed doubt about Eversource’s Aquarion sale, noting it is not a "done deal" as several municipalities and stakeholders oppose the transaction. Jefferies questioned whether "sweetening the deal" would be sufficient to overcome this opposition.
Jefferies also highlighted regulatory challenges in Massachusetts, where Governor Healey has initiated a review of utility rates in the state, creating a less constructive outlook for the company.
While Connecticut’s outlook has improved following the ousting of Gillette, Jefferies emphasized that affordability remains a key concern, with regulatory authorities in both Connecticut and Massachusetts focused on addressing cost of living issues.
The firm acknowledged that short-term tax credits would support Eversource’s third-quarter and fiscal year 2025 earnings per share, but cautioned that these benefits are not sustainable over the long term.
In other recent news, Eversource Energy has announced a $285 million increase in its liability related to future payments to Global Infrastructure Partners following the sale of its South Fork Wind and Revolution Wind projects. Despite this increase, the company expects to benefit from approximately $210 million in federal tax savings, which will result in a net non-recurring after-tax charge of about $75 million. UBS has maintained a Buy rating on Eversource Energy, citing a positive legal development that allows construction on the Revolution Wind project to continue. Meanwhile, Jefferies has raised its price target for Eversource Energy to $54, attributing this to improved cash flows and benefits from Connecticut securitization. However, Jefferies continues to rate the stock as Underperform. Additionally, Eversource Energy’s Board of Trustees has approved a quarterly dividend of $0.7525 per share, payable on September 30, 2025. These developments come amid ongoing changes and assessments by analysts regarding the company’s financial outlook.
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