Mizuho raises Spire stock price target to $82, maintains outperform

Published 18/03/2025, 23:28
Mizuho raises Spire stock price target to $82, maintains outperform

On Tuesday, Mizuho (NYSE:MFG) Securities exhibited confidence in Spire Inc. (NYSE:SR), as its analyst Gabriel Moreen increased the company’s price target from $76.00 to $82.00, while reiterating an Outperform rating on the stock. The revision reflects a positive outlook based on recent developments in Spire’s operations, particularly the potential benefits arising from the company’s Missouri rate case. The utility company, with a market capitalization of $4.47 billion, has demonstrated strong financial discipline, maintaining dividend payments for 55 consecutive years.

Spire’s shares have seen a notable performance, outpacing local distribution company (LDC) peers over recent months. Currently trading near its 52-week high of $78.80, the stock has delivered an impressive 16.74% return over the past six months, significantly outperforming its peers. This outperformance is largely attributed to the progress being made in Missouri’s state legislature, which includes the implementation of forward-test years for gas utilities—a change that is seen to have a favorable impact on Spire.

Despite this strong performance, Spire’s stock continues to trade at a 1.5x discount to its peer group, with a P/E ratio of 18.75x. Moreen suggests that this discount is larger than warranted, indicating a potential undervaluation of Spire’s stock. According to InvestingPro analysis, which considers multiple valuation metrics and growth factors, the stock appears to be trading above its Fair Value. For deeper insights into Spire’s valuation and access to 8 additional exclusive ProTips, consider exploring the comprehensive Pro Research Report available on InvestingPro.

Additionally, Moreen anticipates that Spire’s next earnings release could reveal further upside catalysts, especially from its gas marketing business, which may have benefited from the cold weather patterns experienced in January and February. This expectation has contributed to the decision to raise estimates and target price-to-earnings multiples for Spire.

To arrive at the new price target of $82, which represents a $6 increase from the previous target, Mizuho’s analysis included updated estimates and a roll-forward to fiscal year 2027. The firm’s maintained Outperform rating and revised price target suggest a continued optimistic view on Spire’s stock performance going forward.

In other recent news, Spire Inc. received an upgrade from Ladenburg Thalmann analyst Paul Fremont, who raised the stock rating from Neutral to Buy and set a new price target of $83. This decision follows positive legislative developments in Missouri, particularly the passage of Senate Bill 4, which is expected to enhance Spire’s regulatory environment and financial performance. Ladenburg Thalmann’s projections for Spire’s financial performance in 2027 and 2028 are significantly above the average analyst estimates, reflecting the firm’s optimism about the company’s future. Additionally, Spire announced that its President and CEO, Steven L. Lindsey, will resume his duties on February 10, 2025, after a health-related leave of absence. During his absence, Scott E. Doyle, Executive Vice President and Chief Operating Officer, managed Lindsey’s responsibilities and will continue in his role after Lindsey’s return. In a recent shareholders’ meeting, key proposals were addressed, including the election of directors and approval of the Spire 2025 Equity Incentive Plan. Shareholders also voted in favor of the executive compensation structure and ratified Deloitte & Touche LLP as the independent registered public accounting firm for 2025. These developments demonstrate active shareholder engagement and support for Spire’s governance and strategic initiatives.

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