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On Wednesday, Mizuho (NYSE:MFG) Securities exhibited confidence in Eversource Energy (NYSE:ES) by increasing its price target on the stock to $68 from the previous $62 while retaining an Outperform rating. Currently trading at $61.51, InvestingPro analysis suggests the stock is slightly overvalued, with analyst targets ranging from $47 to $85. The adjustment comes ahead of the confirmation hearings for Chairwoman Gillett’s term extension as a commissioner of the Public Utilities Regulatory Authority (PURA), which are set for February 20, 2025.
Mizuho’s analyst highlighted the current deadlock within the 21-member confirmation committee, with an even split between those in favor of and against reappointing Chairwoman Gillett. The nominating committee consists of eight Republicans, all of whom are believed to be opposed to her reappointment. Support for Chairwoman Gillett seems to be stemming from the Hartford delegation, who back fellow Hartfordite State Senator John Fonfara. The utility company, which boasts a market capitalization of $22.5 billion, has maintained a strong dividend track record, having raised its dividend for 26 consecutive years, according to InvestingPro data.
Recent press has indicated that both Senator Fonfara and Republican Holly Cheeseman have shown interest in obtaining a seat on PURA. Despite this interest, the analyst noted that efforts to expand PURA to a five-member commission appear to be on hold for the time being.
Governor Lamont has taken a stance in this scenario by scheduling a press conference at 10 am to address the issue of "Standing Up Against Utility Bullies." This move by the governor seems to be part of the broader context affecting Eversource Energy’s regulatory environment.
Mizuho’s revised price target reflects the firm’s belief in the strength of Eversource Energy’s stock and its alignment with current market multiples. The analyst’s commentary indicates an anticipation of stability in the company’s regulatory conditions, which is factored into the optimistic outlook for the stock’s performance. With an overall Financial Health Score of "Fair" from InvestingPro, and a moderate beta of 0.64, the company demonstrates relative stability. Investors seeking deeper insights can access the comprehensive Pro Research Report, which provides detailed analysis of Eversource Energy’s financial health, valuation metrics, and growth prospects.
In other recent news, Eversource Energy has been in the spotlight with various developments. The company’s fourth-quarter earnings per share (EPS) of $1.01 matched Scotiabank (TSX:BNS)’s forecast and exceeded the consensus estimate of $0.99. However, Scotiabank analyst Andrew Weisel has adjusted the price target on Eversource’s stock to $55.00 from $56.00, maintaining a Sector Underperform rating due to several concerns, including below-average growth prospects and a strained credit profile.
In a positive development, Eversource Energy, along with Erie Indemnity and FactSet Research Systems, was added to the S&P 500 Dividend Aristocrats, an index that tracks companies with a history of raising their dividends for at least 25 consecutive years. As of January 31, 2025, Eversource offered a dividend yield of 4.96%, significantly higher than the S&P 500 Dividend Aristocrats’ dividend yield of 2.39%.
Furthermore, Eversource Energy has acquired a 26-acre site from Constellation Energy (NASDAQ:CEG), aiming to bolster the region’s clean energy capabilities and grid reliability. This strategic purchase in Everett, Massachusetts, is set to serve as an essential interconnection hub for various large-scale renewable energy sources.
Moreover, Eversource Energy announced an amendment to its executive retirement plan, effective January 1, 2025. The company’s Compensation Committee has approved the addition of the Eversource Supplemental Cash Balance Pension Plan to its existing Supplemental Executive Retirement Program, as detailed in a recent 8-K filing with the Securities and Exchange Commission (SEC).
These are the recent developments surrounding Eversource Energy, shedding light on its financial performance, strategic acquisitions, inclusion in a prestigious index, and changes in its executive retirement program.
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